SMIC’s 14nm chip output has reached industrial production levels.
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China’s largest chip manufacturer SMIC posted record revenue in 2022, despite ongoing US sanctions, but warned of a tougher year ahead due to the slumping semiconductor industry.
SMIC said on Thursday that 2022 revenue totaled $7.2 billion, up 34% year-on-year while the company’s gross profit margin hit a record 38%. This is the second year the company has a revenue growth rate of over 30%.
However, SMIC said that Q1 revenue is forecast to decline between 10% and 12% compared to Q12.
“It is estimated that through 2023, in the first half of the year, the industry cycle remains at the bottom, the impact of external uncertainties remains complex,” the company said in a statement.
SMIC is one of China’s most important chip companies. It is the country’s largest foundry, which makes chips that other companies design. It’s a competitor to Taiwan TSMC and Samsung of Korea but SMIC’s technology is several generations behind.
Company was placed on a US trade blacklist called Entity List in 2020including cut SMIC from important foreign technology that will allow it to make more advanced chips.
Demand for some chips used in consumer products, such as memory, has been hit hard. affects SMIC as well as larger companies like Samsung.
SMIC has been investing heavily to expand capacity in China. The company said its capital expenditure in 2023 is expected to be flat from the $6.35 billion it spent in 2022.
SMIC said mass production at one of its factories, SMIC Jingcheng, would be delayed for one to two quarters due to “equipment bottleneck delays”.
The company did not mention whether recent US far-reaching export controlsaims to cut China off from buying or manufacturing key chips and components, which are behind equipment delays.
