2023 First Quarter Highlights
- Revenue was $1,462.3 million in 1Q23, compared to $1,621.3 million in 4Q22, and $1,841.9 million in 1Q22.
- Gross profit was $304.7 million in 1Q23, compared to $518.7 million in 4Q22, and $750.3 million in 1Q22.
- Gross margin was 20.8% in 1Q23, compared to 32.0% in 4Q22 and 40.7% in 1Q22.
Second Quarter 2023 Guidance
The Company expects (in accordance with IFRS):
- Revenue to increase by 5% to 7% QoQ.
- Gross margin to range from 19% to 21%.
The Management Comments
According to the international financial reporting standards, in the first quarter, the Company's revenue slightly beat guidance, gross margin was close to the high end of our guided range; in the second quarter, the Company expects the capacity utilization rate and shipments will perform better than first quarter. Revenue is expected to increase by 5% to 7% sequentially, with a decline in blended ASP due to the impact of changes in product mix; gross margin is expected to be between 19% and 21%.
The Company carries out capital expenditures in line with the expansion plan. Currently, SMIC Shenzhen has entered mass production; SMIC Jingcheng is expected to enter mass production in the second half of the year; SMIC Oriental is expected to start the mini-line by the end of this year; SMIC Xiqing is still under the construction.
Looking ahead to the full year of 2023, although the revenue bottoms out in the second quarter, the visibility of recovery magnitude for the second half of the year is still not clear. Overall, we haven't seen the sign of market full recovery. Thus, the full year's guidance remains unchanged, revenue is expected to decline by low-teens percentage year-over-year, and the gross margin is expected to be around 20%. We will strive to do better based on the current situation.
Facing the dynamic market changes, we will continue to follow the strategy of being market-oriented and customer-focused, strengthen communication with the end market; we will fully cooperate with the launch of new products, and make adjustments to fix bottleneck issues, so as to meet the next round of growth cycle.
To see the complete results including financial tables, please click here:
https://www.smics.com/uploads/645cc628/ER_EN.pdf
Date: Friday, May 12, 2023
Time: 8:30 A.M. - 9:30 A.M.
WEBCAST
The call will be webcast live at:
https://edge.media-server.com/mmc/p/496fcwj6
CONFERENCE CALL
Please register in advance for the conference call at:
https://register.vevent.com/register/BI8af784294cda4ffd922600e49250090e
REPLAY
Recording will be available 1 hour after the event and it will be archived for 12 months.
https://www.smics.com/en/site/company_financialSummary
Semiconductor Manufacturing International Corporation (SEHK: 00981; SSE STAR MARKET: 688981) and its subsidiaries is one of the leading foundries in the world and is the front runner in manufacturing capability, manufacturing scale, and comprehensive service in the Chinese Mainland. SMIC Group provides semiconductor foundry and technology services to global customers on 0.35 micron to FinFET process node technologies. Headquartered in Shanghai, China, SMIC Group has an international manufacturing and service base, with three 8-inch wafer fabrication facilities ("fabs") and four 12-inch fabs in Shanghai, Beijing, Tianjin and Shenzhen, and three 12-inch fabs under construction in Shanghai, Beijing and Tianjin. SMIC Group also has marketing and customer service offices in the U.S., Europe, Japan, and Taiwan, China, and a representative office in Hong Kong, China.
For more information, please visit www.smics.com.
This release contains, in addition to historical information, forward-looking statements. These forward-looking statements are based on SMIC's current assumptions, expectations, beliefs, plans, objectives, and projections about future events or performance. SMIC uses words including but not limited to "believe", "anticipate", "intend", "estimate", "expect", "project", "target", "going forward", "continue", "ought to", "may", "seek", "should", "plan", "could", "vision", "goal", "aim", "aspire", "objective", "schedule", "outlook" and other similar expressions to identify forward looking statements. These forward-looking statements are estimates made by SMIC's senior management based on their best judgment and involve significant risks, both known and unknown, uncertainties and other factors that may cause SMIC's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, risks associated with cyclicality and market conditions in the semiconductor industry, intense competition in the semiconductor industry, timely wafer acceptance by SMIC's customers, timely introduction of new technologies, SMIC's ability to ramp new products into volume, supply and demand for semiconductor foundry services, industry overcapacity, shortages in equipment, parts, raw materials and software, availability of manufacturing capacity, orders or judgments from pending litigation, intellectual property litigation in the semiconductor industry, general economic conditions, fluctuations in currency exchange rates and the risk of geopolitics.
In addition to the information contained in this release, you should also consider the information contained in our other filings with The Stock Exchange of Hong Kong Limited ("SEHK") and Shanghai Stock Exchange ("SSE") from time to time. Other unknown or unpredictable factors also could have material adverse effects on our future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated or, if no date is stated, as of the date of this release. Except as required by applicable laws, SMIC undertakes no obligation and does not intend to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the possible or actual occurrence of unanticipated events after the date on which such statement is made, whether as a result of new information, future events or otherwise.
To supplement SMIC's consolidated financial results presented in accordance with IFRS, SMIC uses the presentation of non-IFRS financial measures, including EBITDA, EBITDA margin and non-IFRS operating expenses in this release. The presentation of non-IFRS financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with IFRS. These non-IFRS financial measures are not calculated or presented in accordance with, and are not alternatives or substitutes for financial measures prepared in accordance with IFRS, and should be read only in conjunction with the Group's financial measures prepared in accordance with IFRS. The Group's non-IFRS financial measures may be different from similarly-titled non-IFRS financial measures used by other companies.
SMIC believes that use of these non-IFRS financial measures facilitates investors' and management's comparisons to SMIC's historical performance. The Group's management regularly uses these non-IFRS financial measures to understand, manage and evaluate the Group's business and make financial and operational decisions.
The accompanying table has more information and reconciliations of each non-IFRS financial measure to its most directly comparable IFRS financial measure.
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