China’s most prominent chipmaker SMIC posts record earnings despite U.S. boycotts
Key takeaways:
- China’s most extensive chipmaker Semiconductor Manufacturing International Corporation, declared record earnings and a wave in profits the previous year.
- That record implementation came despite SMIC being put on a U.S. trade blocklist called the Entity List in 2020.
- SMIC is also persisting in funding laboriously, and the firm stated that it intends to pay $5 billion in the capital as it attempts to get three new plants off the ground.
High profits and revenues recorded for SMIC:
China’s most extensive chipmaker Semiconductor Manufacturing International Corporation, declared record earnings and a wave in returns the previous year amid an international chip lack but robust demand.
SMIC recorded 2021 earnings of $5.44 billion up 39% year-on-year, the most rapid increase rate since 2010. Earnings came in at $1.7 billion, marking a 138% year-on-year rise.
That record implementation came despite SMIC being put on a U.S. trade blocklist named the Entity List in 2020.
“The multinational lack of chips and the strong need for regional and indigenous manufacturing brought the Firm an infrequent chance, while the limitations of the ‘Entity List’ put many barriers to the Company’s development,” SMIC stated in a statement.
SMIC is China’s largest foundry, which manufactures chips that other companies create. It’s a rival to Taiwan’s TSMC and South Korea’s Samsung, but SMIC’s technology is generations behind.
As geopolitical strains between China and the U.S. have ratcheted up in the previous few years, so has their struggle to conquer critical technologies.
Semiconductors are one of those sites. China is quite behind the U.S. in the chip enterprise, but SMIC is seen as key to promoting self-sufficiency in the sector and weaning itself off foreign technology.