Financial Report is Out | SMIC's Q1 Net Profit Drops by 44%, Expected to Rebound in Q2
SMIC is expected to have higher production capacity utilization and shipment volume in Q2 than in Q1. Q2 revenue is expected to increase by 5% to 7% compared to the previous quarter, with a gross margin range of 19% to 21%.
On Thursday, SMIC released its first quarter financial report. The gross profit margin for the first quarter was 20.8%.
Q2 Guidance
SMIC expects higher capacity utilization and shipment volume in the second quarter than in the first quarter.
Revenue in the second quarter is expected to increase by 5% to 7% QoQ, and the average wafer price will decrease due to changes in product mix.
The gross profit margin is expected to be between 19% and 21%.
SMIC stated that although revenue is expected to rebound in the second quarter, the extent of the recovery in the second half of the year is still unclear. Overall, the market has not yet fully recovered, so the guidance for the year remains unchanged: Sales revenue is expected to decrease by a low double-digit percentage YoY, and the gross profit margin is expected to be around 20%.
Currently, SMIC Shenzhen has entered mass production, SMIC Beijing is expected to enter mass production in the second half of the year, SMIC East is expected to be online by the end of the year, and SMIC Xiqing is still under construction.
Q1 Financial Data
The gross profit margin for the first quarter of 2023 was 20.8%, compared to 32.0% in the fourth quarter of 2022. The change was due to a decrease in wafer shipments and a decline in capacity utilization in the first quarter of 2023.
The gross profit margin is at the upper end of the guidance.
Analysis of Main Business
