SMIC International expects that the automotive and mobile phone industries will face a shortage of memory storage by 2026.

SMIC warned that a shortage of memory could impact the production of cars and consumer electronics in 2026. The company also indicated that the memory shortage could become a bottleneck as major chip manufacturers prioritize business with key AI accelerator company NVIDIA. Co-CEO Zhao Haijun stated that Chinese companies are becoming more cautious about ordering from SMIC early next year due to uncertainties about obtaining sufficient memory supply. Some of the uncertainty stems from expectations of soaring memory prices, reflecting strong demand for AI-related applications. Zhao Haijun told analysts during a Friday earnings call that all companies using memory, whether they are car manufacturers, smartphone manufacturers, or consumer electronics manufacturers, will face pressure from rising prices and supply constraints in the coming year. He mentioned that customers are hesitant to place more orders in the first quarter because they are unsure how many memory chips they can obtain. He pointed out that the market demand currently exceeds SMIC's supply capacity; the company's capital expenditure this year is expected to be in line with or slightly higher than the $7.33 billion spent in 2024. However, overall Chinese chip manufacturers are expected to accelerate capacity expansion.