China’s biggest chipmaker SMIC posts record 2022 revenue

SMIC’s 14nm chip yield has reached industry production levels.

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China’s largest chipmaker SMIC reported record revenue in 2022 despite US sanctions, but warned of another tough year ahead given the slowdown in the semiconductor industry.

SMIC said Thursday that 2022 revenue was to total $7.2 billion, up 34% year-over-year, while its gross margin was a record 38%. This is the second year of sales growth of over 30% for the company.

However, SMIC said that revenue in the first quarter is expected to decline between 10% and 12% compared to the December quarter.

“Looking to 2023, the first half of the year, with the industry cycle still down, the impact of external uncertainties still compounded,” the company said in a statement.

SMIC is one of the most important chip companies in China. It is the country’s largest foundry, a company that makes chips designed by other firms. It’s a competitor to the likes of Taiwan TSMC and Samsung of South Korea but SMIC’s technology is several generations behind,

company was put on a US business blacklist called the Entity List in 2020which is Cut off SMIC from key foreign technology Which will allow it to make more advanced chips.

Decreased demand for some chips that go into consumer products, such as memory, which has been badly hit. Affected SMIC as well as big firms like Samsung,

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SMIC is aggressively investing in capacity expansion in China. The company said its capital expenditure in 2023 is expected to be roughly equal to the $6.35 billion spent in 2022.

SMIC said mass production at one of its plants known as SMIC Jingcheng would be postponed for one to two quarters due to “delays of bottleneck equipment”.

The company did not mention whether Recent comprehensive US export controlsThe move, which aims to block China from obtaining or manufacturing key chips and components, was behind the delay in the equipment.

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