SMIC's net profit increased by 36% last year, and it is expected that the sales revenue in the first quarter of this year will remain flat compared to the previous quarter.

On February 10th, SMIC (688981.SH, 0981.HK) released its Q4 2025 earnings brief. In the fourth quarter, the company achieved operating revenue of 17.8 billion yuan, an 11.9% increase compared to the same period last year; gross profit was 3.1 billion yuan, with a gross margin of 17.4%. Operating profit was 2.1 billion yuan, down 23% year-over-year; net profit attributable to shareholders of the listed company was 1.22 billion yuan, a 23.2% increase. Non-recurring profit and loss net of tax was 947 million yuan, up 112.4%.

For the full year 2025, SMIC’s unaudited operating revenue was 67.3 billion yuan, compared to 57.8 billion yuan last year, a 16.5% increase year-over-year. Net profit attributable to shareholders of the listed company was 5 billion yuan, up from 3.7 billion yuan last year, a 36.3% increase. Net profit attributable to shareholders after deducting non-recurring gains and losses was 4.1 billion yuan, an increase of 55.9%.

Regarding the decrease in operating profit in Q4 2025 compared to the same period last year, SMIC stated that this was mainly due to increased financial expenses and decreased investment income. The net profit attributable to shareholders after deducting non-recurring gains and losses in Q4 2025 increased compared to the same period last year, primarily due to higher wafer sales volume, increased capacity utilization, and product mix changes.

SMIC indicated that in 2025, the restructuring effects brought by the localization shift in the semiconductor supply chain persisted throughout the year. According to unaudited financial data, the company’s sales revenue in 2025 was $9.327 billion, a 16.2% increase year-over-year. The gross margin was 21%, up 3.0 percentage points from the previous year. Capital expenditure in 2025 was $8.1 billion. By the end of the year, the standard 8-inch logic wafer monthly capacity was 1.059 million wafers, an increase of about 110,000 wafers compared to the previous year. Total shipments were approximately 9.7 million wafers, with an average annual capacity utilization rate of 93.5%, an 8 percentage point increase year-over-year.

Looking ahead to 2026, SMIC stated that the opportunities from the return of the supply chain and the challenges from the large storage cycle coexist. Considering various factors, the company’s guidance for the first quarter is: flat sales revenue compared to the previous quarter, with a gross margin between 18% and 20%. Assuming no major changes in the external environment, the company’s guidance for 2026 is: sales revenue growth exceeding the industry average, with capital expenditure roughly the same as in 2025.

As of the close on February 10th, SMIC’s A-shares closed at 116.20 yuan, up 1.11%; SMIC’s H-shares closed at 71.55 HKD, up 1.71%.

(Source: The Paper News)