{"id":4542,"date":"2025-05-09T08:27:50","date_gmt":"2025-05-09T08:27:50","guid":{"rendered":"https:\/\/prepsaret.com\/news\/?p=4542"},"modified":"2025-05-09T08:27:50","modified_gmt":"2025-05-09T08:27:50","slug":"smic-delivers-strong-earnings-yet-cautions-on-tariff-and-production-risks","status":"publish","type":"post","link":"https:\/\/prepsaret.com\/news\/smic-delivers-strong-earnings-yet-cautions-on-tariff-and-production-risks\/","title":{"rendered":"SMIC Delivers Strong Earnings Yet Cautions on Tariff and Production Risks"},"content":{"rendered":"<h1 style=\"text-align: center;\"><b>SMIC Delivers Strong Earnings Yet Cautions on Tariff and Production Risks<\/b><\/h1>\n<p><a href=\"https:\/\/www.smics.com\/en\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Semiconductor Manufacturing International Corp (SMIC)<\/span><\/a><span style=\"font-weight: 400;\">, China\u2019s leading semiconductor producer, posted significant gains in revenue and profit during the first quarter of the year, partly fueled by accelerated orders from U.S. buyers seeking to avoid steeper tariffs.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, the company\u2019s earnings still missed analyst projections, and SMIC warned that upcoming quarters could be more challenging.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">SMIC announced a 162% rise in profit, reaching $188 million for the January to March period compared to the previous year. Revenue also increased by 28%.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Despite this growth, the company failed to meet the $222.4 million profit target projected by LSEG analysts. Following the announcement, SMIC\u2019s shares on the Hong Kong Stock Exchange fell by 6.8%.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Orders from U.S. customers played a notable role, contributing 12.6% of total revenue in the first quarter, up from 8.9% in the previous quarter.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This figure, however, remained below the 14.9% recorded a year earlier. Looking ahead, SMIC projected a potential 6% revenue drop in the second quarter due to lower production yields linked to the rollout of new manufacturing equipment.<\/span><\/p>\n<p><b>Related story: <\/b><a href=\"https:\/\/prepsaret.com\/news\/nvidia-adjusts-h20-chip-for-china-to-comply-with-u-s-export-rules\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Nvidia Adjusts H20 Chip for China to Comply With U.S. Export Rules<\/span><\/a><\/p>\n<h2 style=\"text-align: center;\"><b>Chinese Authorities Step In to Ease Industry Pressures<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Speaking during the earnings call, SMIC co-CEO Zhao Haijun noted that government efforts are underway to shield the chip sector from the impact of U.S.-China trade tensions.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">&#8220;The direct impact on China&#8217;s foundry sector at the moment is minor due to tariff exemptions and a diversified supply chain,&#8221; Zhao stated.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, he cautioned that the situation remains uncertain and warned that reduced customer orders resulting from price hikes could trigger a &#8220;hard landing&#8221; for the semiconductor market.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">SMIC\u2019s core business revolves around producing chips for consumer electronics and household appliances. Advanced chips, such as those found in <\/span><a href=\"https:\/\/consumer.huawei.com\/en\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Huawei smartphones<\/span><\/a><span style=\"font-weight: 400;\">, make up only a small share of its output, and the company has never confirmed supplying Huawei.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In a move to ease trade tensions, the administration of U.S. President Donald Trump granted <\/span><a href=\"https:\/\/prepsaret.com\/news\/china-signals-openness-to-trade-talks-with-u-s-amid-tariff-tensions\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">tariff exemptions on specific Chinese products<\/span><\/a><span style=\"font-weight: 400;\">, including smartphones, computers, and memory chips.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Nevertheless, other tariffs remain in effect. Chinese regulators have also provided tariff relief for certain goods, including semiconductors, to support the country\u2019s technology industry.<\/span><\/p>\n<p><b>Read next:<\/b> <a href=\"https:\/\/prepsaret.com\/news\/microsoft-stock-soars-as-azure-and-ai-drive-strong-quarterly-results\/\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Microsoft Stock Soars as Azure and AI Drive Strong Quarterly Results<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>SMIC Delivers Strong Earnings Yet Cautions on Tariff and Production Risks Semiconductor Manufacturing International Corp (SMIC), China\u2019s leading semiconductor producer, posted significant gains in revenue and profit during the first quarter of the year, partly fueled by accelerated orders from U.S. buyers seeking to avoid steeper tariffs.\u00a0 However, the company\u2019s earnings still missed analyst projections, [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":4544,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[330],"tags":[],"class_list":["post-4542","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.4 (Yoast SEO v25.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>SMIC Delivers Strong Earnings Yet Cautions on Tariff and Production Risks<\/title>\n<meta name=\"description\" content=\"SMIC reports strong earnings this quarter but warns investors of potential revenue declines due to tariff hikes and production yield concerns.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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