United Daily News (UDN), one of the primary Taiwanese news groups, recently reported on the 2024 annual report published by SMIC, China’s largest chip foundry. SMIC’s revenue last year reached US$8.03 billion, a year-over-year increase of 27 percent, ranking as the second-largest chip foundry worldwide by revenue. However, SMIC’s 2024 net profit was only US$490 million, a year-over-year decrease of 45.4 percent. The company stated that the decline in profit was mainly due to a “decline in return on investment.”
Around 89 percent of SMIC’s revenue comes from Mainland China. International industry analysts pointed out that SMIC shouldered the heavy responsibility in 2024 of helping Huawei break through U.S. sanctions by producing 7-nanometer chips, incurring very high production costs. This resulted in a significant reduction in profits. As one of the very few companies in Mainland China that have advanced processes for mass-production of computer chips, SMIC is expected to have higher pricing power domestically in the years ahead.
SMIC said that it expects its 2025 sales revenue growth to outperform that of comparable peers “assuming there is no major change in the external environment.”
Source: UDN, February 12, 2025
https://money.udn.com/money/story/5603/8542229