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Time of India
09-05-2025
- Business
- Time of India
China's SMIC has strong quarter but outlook cloudy due to tariffs, production yields
By Che Pan and Brenda Goh BEIJING: China's top foundry, Semiconductor Manufacturing International Corp ( SMIC ), said first-quarter revenue surged and profit more than doubled, helped in part by rush orders from U.S. customers seeking to beat hikes in tariffs. But the results fell short of analysts' expectations and SMIC predicted a drop in revenue for the current quarter, saying the company could have lower production yields due to the testing of newly installed equipment. Its Hong Kong-listed shares tumbled 6.8%. Chinese authorities have been in close communication with the country's chip sector to mitigate the impact of escalating trade tensions between the U.S. and China, including granting tariff exemptions, co-CEO Zhao Haijun told an earnings call. "The direct impact on China's foundry sector at the moment is minor due to tariff exemptions and a diversified supply chain," he said. But Zhao added that the second half remained unclear and SMIC was watching to see if customers reduce their purchases due to price increases caused by tariffs, which could result in a "hard landing" for the industry. SMIC's profit attributable to shareholders jumped 162% to $188 million in the January-March quarter from a year earlier, but fell short of an LSEG consensus estimate of $222.4 million. Revenue climbed 28%. U.S. clients accounted for 12.6% of its first-quarter revenue, compared with 8.9% in the previous quarter and 14.9% in the same period a year ago SMIC predicted revenue could decline by as much as 6% in the second quarter from the January-March quarter. The foundry focuses on chips for consumer electronics and home appliances. Advanced chips such as those found in Huawei's smartphones represent a very small portion of its sales. SMIC has never confirmed that it produces Huawei chips. U.S. President Donald Trump's administration in April granted exclusions from steep reciprocal tariffs on smartphones, computers and memory chips imported from China. Prior duties on Chinese imports, however, remain in place. Chinese authorities have also granted exemptions on some products, including semiconductors.
South China Morning Post
15-04-2025
- Business
- South China Morning Post
Hong Kong stocks tread water as investors weigh US tariff moves, China GDP data
Hong Kong stocks hovered around a one-week high on Tuesday, as investors digested the latest development on the tariff front from US President Donald Trump while bracing for China's first-quarter economic data. Advertisement The Hang Seng Index fell 0.1 per cent to 21,395.10 as of 10.06am local time. The Hang Seng Tech Index dropped 1.1 per cent. On the mainland, the CSI 300 Index and the Shanghai Composite Index both retreated 0.4 per cent. CK Hutchison Holdings advanced 2.9 per cent to HK$42.30 and Alibaba Group Holding gained 1.9 per cent to HK$110.20. On the flip side, chipmaker Semiconductor Manufacturing International Corp slid 3.5 per cent to HK$45.80 and Macau casino operator Galaxy Entertainment Group lost 3.2 per cent to HK$27.10. While the Trump administration was considering a temporary tariff exemption on cars, the US Commerce Department said it would start investigations into the pharmaceutical and semiconductor industries that could lead to possible levies on the two sectors. Meanwhile, China's statistics bureau will release first-quarter gross domestic product (GDP) data on Wednesday. The GDP probably grew 5.2 per cent in the first three months, according to Bloomberg. Advertisement Two companies started trading. Duality Biotherapeutics surged 128 per cent to HK$216.00 in Hong Kong and organic pigment maker Trust Chem jumped 353 per cent to 58.22 yuan in Shenzhen.
South China Morning Post
28-03-2025
- Business
- South China Morning Post
Tech war: China's top foundry SMIC reports revenue growth in 2024, but net profits plunge
China's top foundry Semiconductor Manufacturing International Corp (SMIC) said its revenues in 2024 reached an all-time high, but net profit almost halved from a year earlier, an indication of the increasing competition in legacy chip production on the mainland. Advertisement In its annual report filed to the Hong Kong stock exchange on Thursday, the company said full-year revenue grew 27 per cent to US$8 billion but net profit plunged 45.4 per cent to US$493 million. Its shares lost 3.4 per cent on Friday morning. Meanwhile, China's No 2 wafer fab, Hua Hong Semiconductor, said in its annual report on Thursday that 2024 revenue fell 12.3 per cent year on year to US$2 billion, with profit sliding 79.2 per cent to US$58 million. Hua Hong's stock in Hong Kong lost 3.3 per cent in the morning session. The sluggish profit performance of China's top two fabs comes as competition in the domestic market has intensified, while US export controls have made it harder for SMIC to move up to more lucrative advanced node production. The consumer electronics segment was SMIC's top customer for wafer sales. Photo: Digitimes In comparison, the world's top foundry, Taiwan Semiconductor Manufacturing Co (TSMC), said earlier that its net profit for 2024 surged nearly 40 per cent from a year earlier to hit an all-time high of US$35 billion, or over 70 times that of SMIC, even though TSMC's revenue was about 12 times SMIC's.
South China Morning Post
28-03-2025
- Business
- South China Morning Post
Taiwan probes China chipmaker SMIC for allegedly poaching staff
Taiwan is investigating whether China's leading chipmaker Semiconductor Manufacturing International Corp (SMIC) illegally poached local engineers as part of an effort to access the island's cutting-edge chip technology. Advertisement SMIC set up a branch in Taiwan posing as a Samoa-based company and tried to hire local talent, prosecutors from Taiwan's Investigation Bureau said Friday in a statement. Local investigators raided 34 locations and conducted 90 interrogations this month as part of a large-scale probe into 11 Chinese tech companies including SMIC, according to the bureau, which is part of the justice ministry. A SMIC representative did not respond to requests for comment. SMIC rose to global fame in 2023 when it worked with Huawei Technologies to produce an advanced 7-nanometere chip despite facing a myriad of US-led curbs that continue to prevent China from securing the most advanced chipmaking equipment. However, the two companies now have hit a snag with technology development as they cannot secure ASML Holding's extreme ultraviolet lithography systems required to make the most cutting-edge chips. A general view of the SMIC facilities in Shanghai, March 15, 2024. Photo: AFP As China faces growing restrictions on its access to advanced foreign technologies, it has aggressively tried to obtain know-how in cutting-edge segments including semiconductors by ramping up efforts to recruit engineers from Taiwan and elsewhere.
Yahoo
28-03-2025
- Business
- Yahoo
Taiwan Probes China Chipmaker SMIC for Allegedly Poaching Staff
(Bloomberg) -- Taiwan is investigating whether China's leading chipmaker Semiconductor Manufacturing International Corp. illegally poached local engineers as part of an effort to access the island's cutting-edge chip technology. Why Did the Government Declare War on My Adorable Tiny Truck? How SUVs Are Making Traffic Worse Trump Slashed International Aid. Geneva Is Feeling the Impact. These US Bridges Face High Risk of Catastrophic Ship Strikes Gold-Rush Fever Returns to Historic New Zealand Mining Town SMIC set up a branch in Taiwan posing as a Samoa-based company and tried to hire local talent, prosecutors from Taiwan's Investigation Bureau said Friday in a statement. Local investigators raided 34 locations and conducted 90 interrogations this month as part of a large-scale probe into 11 Chinese tech companies including SMIC, according to the bureau, which is part of the justice ministry. A SMIC representative did not respond to requests for comment. SMIC rose to global fame in 2023 when it worked with Huawei Technologies Co. to produce an advanced 7-nanometer chip despite facing a myriad of US-led curbs that continue to prevent China from securing the most advanced chipmaking equipment. However, the two companies now have hit a snag with technology development as they cannot secure ASML Holding NV's extreme ultraviolet lithography systems required to make the most cutting-edge chips. As China faces growing restrictions on its access to advanced foreign technologies, it has aggressively tried to obtain know-how in cutting-edge segments including semiconductors by ramping up efforts to recruit engineers from Taiwan and elsewhere. Taiwan has become a favorite talent farm for China as the two sides share the same language while the island boasts of the best chipmaking technologies in the world. Taiwan Semiconductor Manufacturing Co. is the go-to chipmaker for Apple Inc. and Nvidia Corp., producing the majority of the world's AI accelerators. Taiwan does not allow Chinese companies to conduct business activities including hiring locally without formal government approval. However, there have been many cases of Chinese tech companies setting up operations in Taiwan and posing as foreign or local firms. The high pay offered by Chinese companies to lure away Taiwanese engineers has been a perennial story in local media. The investigation bureau said it has opened over 100 investigations into Chinese companies illegally hiring Taiwanese engineers since it formed a task force for such probes in 2020. --With assistance from Gao Yuan, Cindy Wang and Miaojung Lin. Business Schools Are Back Google Is Searching for an Answer to ChatGPT Israel Aims to Be the World's Arms Dealer A New 'China Shock' Is Destroying Jobs Around the World The Richest Americans Kept the Economy Booming. What Happens When They Stop Spending? ©2025 Bloomberg L.P.
