Friday, May 12th 2023
SMIC Reports Q1 2023 Results, Revenue and Profits Down
Semiconductor Manufacturing International Corporation (SEHK: 00981; SSE STAR MARKET: 688981) ("SMIC", the "Company" or "we"), one of the leading semiconductor foundries in the world, today announced its consolidated results of operations for the three months ended March 31, 2023.
According to the international financial reporting standards, in the first quarter, the Company's revenue slightly beat guidance, gross margin was close to the high end of our guided range; in the second quarter, the Company expects the capacity utilization rate and shipments will perform better than first quarter. Revenue is expected to increase by 5% to 7% sequentially, with a decline in blended ASP due to the impact of changes in product mix; gross margin is expected to be between 19% and 21%.
The Company carries out capital expenditures in line with the expansion plan. Currently, SMIC Shenzhen has entered mass production; SMIC Jingcheng is expected to enter mass production in the second half of the year; SMIC Oriental is expected to start the mini-line by the end of this year; SMIC Xiqing is still under the construction.
Looking ahead to the full year of 2023, although the revenue bottoms out in the second quarter, the visibility of recovery magnitude for the second half of the year is still not clear. Overall, we haven't seen the sign of market full recovery. Thus, the full year's guidance remains unchanged, revenue is expected to decline by low-teens percentage year-over-year, and the gross margin is expected to be around 20%. We will strive to do better based on the current situation.
Facing the dynamic market changes, we will continue to follow the strategy of being market-oriented and customer-focused, strengthen communication with the end market; we will fully cooperate with the launch of new products, and make adjustments to fix bottleneck issues, so as to meet the next round of growth cycle.
First Quarter 2023 Highlights
The Company expects (in accordance with IFRS):
According to the international financial reporting standards, in the first quarter, the Company's revenue slightly beat guidance, gross margin was close to the high end of our guided range; in the second quarter, the Company expects the capacity utilization rate and shipments will perform better than first quarter. Revenue is expected to increase by 5% to 7% sequentially, with a decline in blended ASP due to the impact of changes in product mix; gross margin is expected to be between 19% and 21%.
Looking ahead to the full year of 2023, although the revenue bottoms out in the second quarter, the visibility of recovery magnitude for the second half of the year is still not clear. Overall, we haven't seen the sign of market full recovery. Thus, the full year's guidance remains unchanged, revenue is expected to decline by low-teens percentage year-over-year, and the gross margin is expected to be around 20%. We will strive to do better based on the current situation.
Facing the dynamic market changes, we will continue to follow the strategy of being market-oriented and customer-focused, strengthen communication with the end market; we will fully cooperate with the launch of new products, and make adjustments to fix bottleneck issues, so as to meet the next round of growth cycle.
First Quarter 2023 Highlights
- Revenue was $1,462.3 million in 1Q23, compared to $1,621.3 million in 4Q22, and $1,841.9 million in 1Q22.
- Gross profit was $304.7 million in 1Q23, compared to $518.7 million in 4Q22, and $750.3 million in 1Q22.
- Gross margin was 20.8% in 1Q23, compared to 32.0% in 4Q22 and 40.7% in 1Q22.
- The following statements are forward looking statements based on current expectations and involved risks and uncertainties.
The Company expects (in accordance with IFRS):
- Revenue to increase by 5% to 7% QoQ.
- Gross margin to range from 19% to 21%.
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