Chinese chip foundry SMIC sees no exodus of customers amid ongoing US restrictions, reports record-high revenue for 2020
- SMIC said it is negotiating with the Biden administration over US sanctions imposed on it by the Trump Administration, but declined to elaborate
- Despite posting record-high annual revenue, SMIC saw its share of wafer revenue for advanced nodes fall by large margin due to the loss of Huawei Technologies Co.
Semiconductor Manufacturing International Corporation (SMIC), China’s chipmaking champion, said on Friday that it has not seen an exodus of customers amid ongoing US restrictions imposed by former US President Donald Trump and that it was “working hard” with US suppliers to mitigate risks in its supply chain.
“The production capacity is tight around global foundries,” Zhao Haijun, co-CEO of SMIC, said on the company’s fourth-quarter earnings call. “Our customers, like us, can’t really change their suppliers right away.
“They continue to work with us to make plans for their new products,” Zhao said, adding that some clients expressed worries over the supply chain disruptions.
Despite a boardroom shake-up and US restrictions, SMIC, the flag-bearer of China’s chip-making industry, posted its second highest quarterly revenue on record, booking US$981.1 million for the quarter ended December 31 on brisk demand in consumer electronics boosted by the Covid-19 pandemic. That compared to US$839 million revenue in the same period a year ago. SMIC also reported record-high full-year results of US$3.91 billion.
The company said it expected “uncertainties” due to its addition to the US Commerce Department Entity List over its alleged ties to the Chinese military, a charge that SMIC has repeatedly denied. The US restrictions, which require the company to apply for licences to use American products and services, could push its capacity expansion plans to the end of the first half of 2021.