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SMIC and Hua Hong profits jump on AI chip demand in China
In the June quarter, SMIC net profit rose 261.7% year on year to US$479.2 million, while Hua Hong reached record quarterly revenue of US$717.5 million.
China’s leading contract chipmakers, SMIC and Hua Hong Grace Semiconductor, posted triple digit profit growth in the second quarter, pointing to strong demand for domestic artificial intelligence chips that are not covered by US export controls, according to SCMP Economy.
SMIC said net profit climbed 261.7% year on year to US$479.2 million in the June quarter. Hua Hong’s net profit surged 385.9% year on year to US$38.6 million, while its revenue reached a record US$717.5 million, up 26.8% from a year earlier.
SCMP Economy said the results reflect how local foundries are running fabrication plants at full capacity to meet domestic needs as major tech companies and start ups seek more computing power for large model training and AI applications.
SMIC also said in a filing to the Hong Kong stock exchange that AI driven industrial momentum should persist into the second half, and it plans to flexibly allocate existing capacity and accelerate new capacity to ease supply constraints.