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Article: China’s SMIC expects flat revenue as drop in low-end orders offsets AI chip growth

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SMIC, China's largest contract chipmaker, expects flat revenue for the first quarter as declining orders for low-end products, like smartphones, offset strong demand for AI chips. The company reported annual revenue and profit growth for 2025, but its profit still fell short of analyst estimates. SMIC's leadership stated they are positioned to address market demands to drive future growth in 2026.

The main topics covered are SMIC's financial performance, its flat revenue outlook due to shifting market demand between low-end and AI chips, and its role in China's semiconductor self-reliance efforts.

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https://www.scmp.com/tech/big-tech/article/3343139/chinas-smic-expects-flat-revenue-drop-low-end-orders-offsets-ai-chip-growth?utm_source=rss_feed

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Big Tech - South China Morning Post

Published Date

2026-02-11 03:13

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2026-03-04 14:30

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2026-03-04 15:19

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China’s SMIC expects flat revenue as drop in low-end orders offsets AI chip growth
The contract chipmaker’s profit falls short of analyst estimates amid ‘challenges’ brought on by memory supply crunch
Semiconductor Manufacturing International Corp (SMIC), China’s largest contract chipmaker, said it expected first quarter revenue to remain flat as a decline in low-end orders partly offset surging demand for chips used in artificial intelligence applications.
SMIC reported on Tuesday that 2025 revenue increased 16.2 per cent from a year earlier to US$9.3 billion, while net profit surged 39 per cent to US$685.1 million. The growth was mainly due to increases in wafer shipment and utilisation rate, as well as changes in product mix, SMIC said.
However, profit for both the full year and the fourth quarter fell short of analyst estimates, and the company’s Hong Kong-listed shares dropped 2.2 per cent to HK$70 on Wednesday. Its Shanghai-listed stock fell 1 per cent to 115.01 yuan.
In an earnings call on Wednesday, Zhao Haijun, co-CEO of SMIC, said the company had seen orders from smartphone vendors and makers of other lower-end products “squeezed” by strong demand for AI chips, leading to the company’s flat revenue expectation.
However, he added that the company was “still well positioned in the current industry development cycle”, adding that SMIC would proactively address urgent market demand to drive revenue growth in 2026.
Shanghai-based SMIC, which anchors Beijing’s drive for semiconductor self-reliance, shipped a total of 9.7 million wafers in 2025, up 21 per cent from 8 million a year earlier. Capacity utilisation rose by 8 percentage points year on year to 93.5 per cent.