Lates News

Goldman Sachs released a research report stating that the second quarter revenue of SMIC increased by 16% year-on-year, surpassing the bank and market expectations by 4% and 2% respectively. The gross profit margin recorded 20.4%, slightly higher than the company's guidance and market expectations, mainly due to the increase in production capacity utilization to 92.5% compared to less than 90% in the first quarter. The group's revenue guidance for the third quarter is expected to grow by 5% to 7% quarterly, in line with market expectations, while the gross profit margin is expected to be maintained at 18% to 20%, slightly lower than Goldman Sachs' expected 20.6% and the market expectation of 21.1%. Looking forward, the potential for domestic demand in China to drive long-term growth, Goldman Sachs maintains a "buy" rating on SMIC with a target price of HK$63.7, believing that despite pricing competition and depreciation pressures, the improvement in production capacity utilization and the mass production of 12-inch factories are expected to gradually boost the gross profit margin.