SMIC's revenue in the first half of the year increased by 22% year-on-year, and net profit grew by 35.6%. The annual target is to exceed the average of comparable peers | Financial Report Insights

SMIC's revenue in the first half of the year increased by 22.0% year-on-year to USD 4.456 billion, with a gross margin rising to 21.4% and a net margin reaching 10.5%, showing comprehensive improvement in core operating indicators. Among them, the revenue from the wafer foundry business, which accounts for the largest share, was USD 4.229 billion, a year-on-year increase of 24.6%.

Looking ahead to the second half of the year, SMIC's management stated that due to changes in domestic and foreign policies, the situation of channels intensifying inventory stocking and replenishment is expected to continue into the third quarter. Although the fourth quarter is traditionally a slow season for the industry, the overall capacity of the company is in short supply, and the slowdown in volume will not have a significant impact on capacity utilization.

On the 28th, SMIC announced its financial report for the first half of 2025:

• Revenue increased by 22.0% year-on-year to USD 4.46 billion.
• Net profit attributable to the parent company increased by 35.6% to USD 320 million, with non-recurring net profit increasing by 46.4%.
• Gross margin significantly increased by 7.6 percentage points to 21.4%.
• Basic earnings per share of USD 0.04, a year-on-year increase of 33.3%.

Comprehensive Improvement in Core Operating Indicators

In the first half of 2025, SMIC achieved revenue of USD 4.456 billion, an increase of 22.0% compared to USD 3.651 billion in the same period last year. Among them, the revenue from the wafer foundry business, which accounts for the largest share, was USD 4.229 billion, a year-on-year increase of 24.6%.

In terms of profitability, the company's gross profit was USD 956 million, a year-on-year increase of 89.3%. The gross margin rose significantly from 13.8% in the same period last year to 21.4%, and the net margin improved from 6.5% to 10.5%. The net profit attributable to the owners of the company was USD 321 million, a year-on-year increase of 35.6%.

EBITDA reached USD 2.421 billion, a year-on-year increase of 24.6%, with an EBITDA margin of 54.3%, up 1.1 percentage points from the same period last year. Basic earnings per share were USD 0.04, a year-on-year increase of 33.3%.

The company's management pointed out that the improvement in performance is mainly due to the combined effects of increased sales volume of wafers, rising average selling prices, and changes in product mix.

Capacity Expansion and Continuous Optimization of Product Structure

In terms of capacity construction, SMIC added nearly 20,000 pieces of 12-inch standard logic monthly capacity in the first half of the year, maintaining an industry-leading overall capacity utilization rate. The company continues to focus on differentiated platform construction, steadily advancing multiple technology platforms such as the 28nm ultra-low leakage platform, 40nm embedded flash memory, and 65nm RF SOI.

From the revenue structure, consumer electronics accounted for 40.8%, becoming the largest application field, smartphones accounted for 24.6%, and computers and tablets accounted for 16.2%. Notably, the share of industrial and automotive applications increased from 7.7% in the same period last year to 10.1%, reflecting positive changes in downstream demand structure.

Analyzing the capacity structure, the revenue share of 12-inch wafers increased from 74.5% in the same period last year to 77.1%, while the share of 8-inch wafers correspondingly decreased to 22.9%, indicating that the company's product structure continues to optimize towards advanced processes From the perspective of regional distribution, the revenue from the China region accounts for 84.2%, an increase from 80.9% in the same period last year, while the U.S. region accounts for 12.7% and the Eurasia region accounts for 3.1%.

Outlook and Strategic Planning

Looking ahead to the second half of the year, the management of SMIC stated that the company's goal for the entire year is to exceed the average level of comparable peers:

"In the first half of 2025, influenced by changes in domestic and foreign policies, channels will accelerate inventory stocking and replenishment, and the company will actively cooperate with customers to ensure shipments. This situation is expected to continue until the third quarter. The fourth quarter is traditionally a slow season for the industry, and urgent orders and shipment pull-ups will relatively slow down.

Due to the overall supply-demand imbalance of the company's capacity, the slowdown in volume will not have a significant impact on the company's capacity utilization rate. Provided there are no major changes in the external environment, the company's goal for the entire year is to exceed the average level of comparable peers."

The company will continue to focus on annual performance growth, development of new application scenarios, construction of important projects, and deep cooperation between industry, academia, and research, striving to achieve more effective results in excellent operations, product iteration, long-term layout, and open innovation.

In the evolving landscape of the global wafer foundry industry, SMIC continues to maintain its position as the second-largest pure-play wafer foundry in the world, thanks to its technological leadership, platform diversity, and scale advantages, ranking first among companies in mainland China. With emerging applications such as artificial intelligence and smart driving driving the growth of semiconductor demand, the company is expected to continue benefiting from the industry's development dividends