SMIC reports H1 net profit of $320M, up 35.6% Y/Y

SMIC reports H1 net profit of $320M, up 35.6% Y/Y

Semiconductor Manufacturing International Company (SMIC) has reported its H1 net profit of $320 million, marking a significant 35.6% year-over-year (YoY) increase. This robust financial performance highlights the company's resilience and growth potential amidst the dynamic semiconductor industry landscape.

The quarterly results, released on July 2, 2025, show that SMIC's net sales for the first half of 2025 reached $2.171 billion, up 3.51% from the same period last year. The company's earnings before tax (EBT) increased to $349 million, up 29.87% YoY. The improved financial performance is driven by strong demand for semiconductor products, particularly in the AI and high-bandwidth memory sectors.

SMIC's operational efficiency and strategic investments have been key drivers of its growth. The company has been leveraging public funds to scale advanced manufacturing facilities, as evidenced by its receipt of subsidies and grants under the U.S. government's CHIPS Act [1]. The Act, which aims to boost domestic semiconductor production, has provided SMIC with the necessary capital to expand its manufacturing capabilities and enhance its competitive position.

However, the company's geographic restrictions under the CHIPS Act, which ban recipients from expanding in adversarial nations for 10 years, may limit its flexibility to optimize global supply chains [1]. This could potentially impact the company's operational efficiency and growth prospects in the long term.

In contrast, SMIC's focus on high-bandwidth memory (HBM) and DDR5 technologies positions it to capitalize on the growing demand for AI-driven applications. The company's leadership in these technologies underscores its strategic importance in the semiconductor industry, particularly in the context of the U.S. government's push for technological dominance.

Investors should closely monitor SMIC's earnings releases and other financial metrics to gauge its continued performance. The company's ability to adapt to evolving geopolitical and technological landscapes will be crucial for its long-term success.

References:
[1] https://www.ainvest.com/news/government-intervention-semiconductor-manufacturing-strategic-bet-future-2508/