At 6 p.m. on February 10, Semiconductor Manufacturing International Corporation(688981) headquartered in Shanghai and listed on the Shanghai Science and innovation board and the Hong Kong Stock Exchange announced its fourth quarter earnings as of the end of December last year. So far, the top four wafer foundry in the world, including TSMC, liandian, grofangde and Semiconductor Manufacturing International Corporation(688981) , have been listed. Semiconductor Manufacturing International Corporation(688981) in a single quarter, the revenue increased by 53.8% year-on-year, the net profit increased by 173% year-on-year, and the deduction of non net profit increased by 3553.6% year-on-year. It is the fastest growing company among the four wafer foundry factories.
Semiconductor Manufacturing International Corporation(688981) said in the announcement that 2021 was “extremely extraordinary”. During the year, the competition between Chinese and American chips continued to be intense, and the list of American entities became longer and longer, bringing certain operating pressure to Semiconductor Manufacturing International Corporation(688981) . However, China’s domestic and overseas demand increased significantly, driving Semiconductor Manufacturing International Corporation(688981) sales to continue to rise, resulting in record breaking business performance.
In addition, Semiconductor Manufacturing International Corporation(688981) outlook said that this year’s global chip core shortage will change from “overall core shortage” to “structural core shortage”. The company is currently promoting the construction of three new plants, and its capital expenditure will reach US $5 billion during the year.
SMIC’s operation is superior to that of its peers
According to the financial report of China’s accounting standards, in the fourth quarter of last year, Semiconductor Manufacturing International Corporation(688981) revenue was 10.26 billion yuan, a year-on-year increase of 53.8%, the net profit reached 3.415 billion US dollars, an annual increase of 172.7%, and the net profit after deducting non recurring profits and losses reached 1.479 billion yuan, an annual increase of 3553.6%.
If translated into US dollars and adopted international financial reporting standards, the performance of Semiconductor Manufacturing International Corporation(688981) will be better. Due to the slight appreciation of the RMB against the US dollar last year, the growth rate of Semiconductor Manufacturing International Corporation(688981) among the world’s top four wafer foundry reached the highest level. In contrast, TSMC’s revenue and net profit increased by 21.2% and 16.4% year-on-year in the fourth quarter, while liandian’s revenue and net profit increased by 30.5% and 42.5% year-on-year in the same period. In addition, although grofangde’s revenue increased by 74% year-on-year, its net profit after turning loss into profit was US $43 million, less than Semiconductor Manufacturing International Corporation(688981) .
In addition, Semiconductor Manufacturing International Corporation(688981) has preliminarily counted the annual performance in 2021, which needs to be audited. Preliminary statistics show that the company’s total revenue last year was 35.63 billion yuan, an annual increase of 29%, the net profit was 10.73 billion yuan, an annual increase of 147.7%, and the net profit after deducting non recurring profits and losses was 5.21 billion yuan, an annual increase of 207%. This achievement still ranks first among the world’s four leading wafers.
Semiconductor Manufacturing International Corporation(688981) frankly, the increase in sales revenue in the fourth quarter of last year was mainly due to the increase in wafer sales, the increase in average selling price, and the change in product portfolio, which means that Semiconductor Manufacturing International Corporation(688981) has increased the OEM proportion of high-end wafers.
In last year’s market, supply interruption and lack of production capacity are important problems perplexing the industry. Maintaining stable supply of wafer factories has become an important factor for the market to evaluate their advantages and disadvantages. Semiconductor Manufacturing International Corporation(688981) said that taking “ensuring production continuity, meeting customer needs and alleviating the shortage of the industrial chain” as the primary task, it has carried out accurate tackling and achieved gratifying results.
the “core shortage” market will change this year
Looking forward to 2022, Semiconductor Manufacturing International Corporation(688981) said that challenges and opportunities coexist, and pointed out that the “core shortage” market will gradually change from “full line shortage” to “structural shortage”.
“Structural shortage” means that the wafer capacity of specific functions and processes will be in short supply, while the supply and demand of other wafers will return to normal. How to grasp the orders of specific functions and processes will become the key factor for wafer factories to win market competitiveness.
Semiconductor Manufacturing International Corporation(688981) said that the product platform and capacity accumulated over the years are concentrated in the structural gap.
In fact, at present, many chip manufacturing companies, such as TSMC, Grosvenor of the United States, Semiconductor Manufacturing International Corporation(688981) , Samsung of South Korea, Intel of the United States and Infineon of Germany, are vigorously expanding their production capacity. Many companies have spent tens of billions of dollars on plant construction. For example, TSMC’s planned capital expenditure for 2022 is as high as $40 billion to $44 billion, while Intel started the construction of two large factories in the United States last year, with a total investment of $40 billion.
How to choose the technology of the new Fab and what kind of market demand to target are the main problems that the fabs are thinking about at present, testing their market judgment and foresight. At present, Semiconductor Manufacturing International Corporation(688981) is building new factories in Beijing, Shanghai and Shenzhen at the same time, with the goal of increasing the production capacity of 12 inch mature process wafers.
As the largest wafer foundries in Chinese mainland, Semiconductor Manufacturing International Corporation(688981) has attracted international attention. In the performance disclosure of the fourth quarter, Semiconductor Manufacturing International Corporation(688981) also stressed that the company will always adhere to compliance operation, will continue to adhere to “internationalization”, deeply integrate the global industrial chain and serve global customers.
