At SMIC’s third-quarter 2026 earnings meeting on November 13, co-CEO Zhao Haijun said demand for AI computing capacity continues to outstrip supply. He described 2027 as a year in which semiconductor foundry capacity is expected to be very tight, citing what he called an industry consensus that the shortage could last until mid-to-late 2028.
Zhao said AI-related memory supply and demand might reach a basic balance after mid-2028, while computing chips and other supporting chips could remain in short supply. Those are forecasts, not confirmed outcomes.
The outlook differs by product category. Zhao said demand for smartphones and lower- to mid-range consumer products has weakened and could continue to decline. SMIC has been redirecting capacity freed by softer smartphone and consumer orders toward higher-demand, higher-value products, including specialty memory and BCD chips.
For the fourth quarter, SMIC expects revenue to rise 4%–6% from the previous quarter, supported by a change in product mix and higher average selling prices. It guided for a gross margin of 26%–28%, in line with its previous-quarter guidance. The company expects capacity utilization to decline slightly as new capacity comes online, engineering and R&D wafer starts increase, and depreciation and raw-material costs remain under pressure.
Zhao also said SMIC expects full-year sales revenue to exceed $12 billion, up nearly 30% year over year. Despite an approximately 30% increase in total depreciation, the company expects a gross margin of around 26%, roughly five percentage points higher than a year earlier.
Source: IT之家