China’s SMIC pledges to steer clear of price war
Beating expectations, SMIC forecast a 13% to 15% quarter-on-quarter revenue rise for the current quarter.
Reporting strong revenue growth in the second quarter, China’s chipmaker Semiconductor Manufacturing International Corp (SMIC) said it will avoid a price war in the industry.
“We have indeed encountered a situation where some of our peers with excess capacity are using low prices to attract customers,” said Co-CEO Zhao Haijun. “SMIC will not take the initiative to cut prices.”
Zhao had warned about a price war a few months ago.
He said the industry was seeing favourable trends that would continue into the second half of 2024. Giving an example of such trends, he said companies were switching to local semiconductor suppliers because of geopolitical tensions.
Beating expectations, SMIC forecast a 13% to 15% quarter-on-quarter revenue rise for the current quarter.
SMIC reported USD 164.6 million in unaudited profit for the three months ended June 30, bettering the USD 103.8 million expected by analysts. However, China’s largest chip foundry reported a 59.1% drop in second-quarter net profit.
Year-over-year revenue increased by 21.8% to USD 1.9 billion, also beating forecasts.
SMIC’s monthly capacity during the second quarter was 837,000 8-inch equivalent wafers.
