Semiconductor Manufacturing International Corp (SMIC), the mainland's biggest contract chipmaker, swung to a net loss of US$2.1 million in the second quarter on pricing pressure in the dynamic random access memory (DRam) market, the company said yesterday. The company made a net profit of US$8.8 million in the first quarter and US$1.35 million for the same period last year. For the first half of this year, net profit was US$6.7 million from a net loss of US$8.27 million in the same period last year. Sales gained 3.7 per cent to US$374.8 million in the reported period from a year ago while declining 3.5 per cent over the first quarter of this year. 'The company posted increasing revenues on a yearly basis. However, the declining revenues in the second quarter were due to the difficult pricing pressure in the DRam market,' said Richard Chang, chief executive. The company said third-quarter revenue would increase 2 per cent to 5 per cent from the second quarter. Capital expenditure would be cut to about US$150 million to US$200 million, compared with US$370 million in the second quarter as the company pursues better profitability. SMIC's gross profit margin improved to 10.3 per cent in the reported period, up from 9.5 per cent in the first quarter, on increasing contribution from advanced products. 'Our revenues from the 90-nanometer technology made up 22 per cent of wafer revenue, up from 14 per cent over the previous quarter. It was only less than 1 per cent of wafer revenues a year earlier,' chief executive Mr Chang said. Revenue from the 90-nanometer-related products would continue to increase in the third quarter, the company said. Industry spot market prices for DRam products have declined more than 25 per cent in the first half and were little changed at the end of last month from a year earlier. DRam products, the most common type of memory chip for computers and workstations, accounted for 28.9 per cent of company's total revenue.