SMIC’s Q3 Financial Report: A Major Milestone in Chip Production
Summary:
- SMIC achieves a monthly production capacity exceeding one million 8-inch wafers in Q3 2025.
- This marks a significant year-over-year net profit increase of 43.1%, showcasing robust financial performance.
- Despite growth, SMIC still trails TSMC in production capacity and advanced technology processes.
On November 13, Semiconductor Manufacturing International Corporation (SMIC), the foremost player in China’s chip foundry sector, unveiled its financial results for the third quarter of 2025. The report indicates a strong operational performance, with overall operating income climbing to 17.162 billion yuan. This represents a month-on-month increase of 6.9% and a year-over-year rise of 9.9%.
The net profit attributable to the parent company was recorded at 1.517 billion yuan, showcasing a remarkable 43.1% increase from the previous year. Moreover, the company’s gross profit margin expanded to 25.5%, an increase of 4.8 percentage points from the previous quarter.
Milestone Production Capacity
One of the standout achievements in this quarter is SMIC’s production capacity milestone: it exceeded one million wafers monthly for the first time. The production of 8-inch standard logic wafers rose from 991,250 in Q2 to 1,022,750 in Q3.
To contextualize this milestone within the global landscape, it’s noteworthy that TSMC, a dominant player in the industry, achieved a wafer delivery volume of approximately 9.191 million in Q2, averaging around 3.06 million wafers per month. This means SMIC now holds about one-third of TSMC’s production capability.
When comparing domestic competitors, Huahong International, which ranks as the second-largest wafer foundry, has a monthly production capacity of around 460,000 wafers. SMIC’s production is more than double that of Huahong, solidifying its competitive edge.
Competitive Landscape and Future Growth
Despite these achievements, it’s essential to recognize that SMIC still faces challenges in closing the gap with TSMC. The disparity lies not only in production volume but also in the advanced process technologies. TSMC’s revenue is heavily driven by advanced processes below 7nm, which account for a substantial 74% of its total revenue. Last year, TSMC shipped 17 million 12-inch wafers with an impressive gross profit margin of approximately 60%.
In terms of capital investment, SMIC has made significant strides, with capital expenditures reaching 40.256 billion yuan in the first three quarters of 2025—closing in on the total of 40.7 billion yuan for the entire previous year. Within this quarter alone, an investment of 20 billion yuan was completed. Looking ahead, the company has 81.6 billion yuan worth of construction projects underway, positioning it for rapid production growth over the next two years.
Conclusion
SMIC’s latest quarterly performance demonstrates its resilience and growth potential amidst a competitive and rapidly evolving semiconductor industry. As it continues to invest heavily in capacity expansion and technology enhancements, SMIC is strategically positioned to strengthen its market presence. However, the journey to bridge the technological gap with industry leaders like TSMC remains a critical focus for the company moving forward.
In summary, while SMIC has celebrated significant milestones in production capacity and financial growth, maintaining its trajectory of advancement in technology and production efficiencies will be vital for its sustained success in the global chip market.
