SMIC's Record Revenue Signals Strong Semiconductor Production Amidst US Sanctions

Overview of SMIC's Growth

SMIC, or Semiconductor Manufacturing International Corp, has recently posted record quarterly revenue, reflecting its unparalleled position in the Chinese semiconductor production landscape. The latest financial report reveals that despite stringent US sanctions, the company achieved significant growth in revenue and net profit.

Exceptional Financial Results

The third-quarter revenue soared by 34% year-on-year, reaching US$2.17 billion, while the net profit experienced a remarkable 58.3% increase, amounting to US$148.8 million. This milestone reflects SMIC’s capability to tap into booming domestic demand for legacy chips.

• 2,122,266 eight-inch equivalent wafers shipped during the quarter
• Capacity utilization rate peaked at 90.4%, marking a six-quarter high
• Chinese customers accounted for 86.6% of total revenue

Impact of US Sanctions

In light of recent sanctions imposed by Washington, there are rising concerns regarding SMIC's compliance with US regulations. Lawmakers, led by Michael McCaul, are demanding investigations into alleged illegal chip production for Huawei by SMIC. This scrutiny reflects heightened tensions between Washington and the semiconductor sector in China.

Technology Developments

The company recently applied advanced technology to craft Huawei’s Kirin 9000s chipset using ASML equipment. This innovation has sparked controversy and prompted harsher measures from the U.S. on Chinese semiconductor producers.

Conclusion: Future Prospects

Although SMIC faces significant challenges from U.S. sanctions, its strategic pivot towards domestic clients and innovative technologies may lead to sustained growth. The future of semiconductor production in China looks promising as domestic demand thrives and technological advancements continue.