Core Viewpoint - SMIC is on track for a record revenue year, expecting to exceed $9 billion for the first time, driven by strong demand and full-capacity operations [1] Financial Performance - Q3 revenue reached 171.62 billion yuan, a year-on-year increase of 9.9% and a quarter-on-quarter growth of 6.9% [2][3] - Gross margin for Q3 was 25.5%, significantly up by 4.8 percentage points from the previous quarter [2][3] - Net profit attributable to shareholders for Q3 surged by 43.1% to 15.17 billion yuan, with a year-to-date net profit of 38.18 billion yuan, reflecting a 41.1% increase [2][3] - Capacity utilization rate rose to 95.8%, indicating strong demand [2][3] Future Outlook - Despite a seasonal slowdown in Q4, SMIC's management anticipates revenue growth of 0% to 2%, aligning with market expectations [1][3] - The projected gross margin for Q4 is expected to decline to between 18% and 20%, down approximately 6 percentage points from Q3 [3] Market Position - The company is benefiting from a supply-demand imbalance in the memory market, with prices significantly increasing [1] - Goldman Sachs maintains a "Buy" rating on SMIC, citing long-term growth potential driven by local demand and AI-related opportunities, with a target price of 117 HKD and 211 RMB [1]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $2,382 million, representing a sequential increase of 7.8% [4][11] - Gross margin improved to 22%, up 1.6 percentage points sequentially [4][15] - Profit from operations was $351 million, with EBITDA at $1,430 million and an EBITDA margin of 60% [4] - Profit attributable to the company was $192 million [4] - Total assets reached $49.4 billion, with total cash on hand at $11.4 billion and total liabilities at $16.4 billion [5] - The debt-to-equity ratio was 34.8%, and the net debt-to-equity ratio was 0.4% [5] - Net cash generated from operating activities was $941 million, while net cash used in investing activities was $2.062 billion [6] Business Line Data and Key Metrics Changes - Wafer revenue from 12-inch and 8-inch wafers accounted for 77% and 23% respectively, with stable proportions [11] - The utilization rate was 95.8%, and wafer shipments increased by 4.6% sequentially to 2,499,000 standard logic 8-inch equivalent wafers [11] - Blended wafer price increased by 3.8% sequentially due to a favorable product mix [11] Market Data and Key Metrics Changes - Revenue by region: China accounted for 86%, America 11%, and New Asia 3% [12] - Revenue from the China region increased by 11% sequentially, driven by demand pull-in and domestic market expansion [12] Company Strategy and Development Direction - The company is focusing on strengthening its product platforms, with advancements in specialty technologies and a variety of applications [18] - The company is actively collaborating with customers to ensure shipments and meet demand amid industry reshuffling [19][20] - The fourth quarter is expected to follow a traditional seasonal pattern, with revenue guidance flat to up 2% sequentially [8][17] Management's Comments on Operating Environment and Future Outlook - Management noted that the overall production lines are still in short supply, indicating strong demand [20] - The company anticipates a successful completion of 2025, with full-year revenue expected to exceed $9 billion [17][21] Other Important Information - For the first three quarters of 2025, revenue reached $6.838 billion, up 17.4% year-over-year [16] - The gross margin for the first three quarters was 21.6%, up 5.3 percentage points compared to the same period last year [16] Q&A Session Summary Question: Inquiry about the super cycle and 2026 outlook - Management discussed the potential for a super cycle in 2026 and the company's readiness to meet demand [23][24] Question: Questions regarding MCU and product lines - Management provided insights on MCU production and the company's focus on various product lines, including NOR Flash and NAND Flash [25][26] Question: Further inquiries on specific technologies and market trends - Management addressed questions related to specific technologies such as CMOS Image Sensors and market trends in automotive and consumer electronics [27][28]

Market Overview - Memory market currently experiences supply shortage and significant price increases [1] - Foundry and memory industries will see accelerated capacity expansion in the coming year [1] Industry Impact - Memory upgrades benefit the manufacturing sector [1] - Original equipment manufacturers (OEMs) using memory, such as those in automotive, smartphone, and consumer electronics, will face price pressures [1]

Core Insights - The executives of SMIC indicate that the pace of capacity expansion in both the foundry and memory sectors is expected to increase in the coming year [1] Industry Summary - The foundry industry is projected to see heightened capacity expansion in the next year [1] - The memory industry is also anticipated to experience an increase in capacity expansion rates [1]

Core Viewpoint - The current acceleration in the industry chain transition is highlighted, with the company actively cooperating with clients to ensure shipments, leading to an increase in production capacity and shipment volume in Q3 [1] Group 1: Company Performance - The average selling price increased by 3.8% quarter-on-quarter due to a rise in shipments of more complex products [1] - The company anticipates total sales revenue to exceed $9 billion for the year, marking a significant milestone in revenue scale [1] Group 2: Market Conditions - In Q4, typically a slow season for the industry, client inventory replenishment has slowed; however, the ongoing effects of industry chain iteration are expected to keep demand strong, resulting in a "not-so-slow" off-season [1] - The production lines remain in a state of supply shortage despite the seasonal slowdown [1]

Group 1 - The core viewpoint of the article highlights that there is a tight supply of storage devices, leading to a rapid increase in prices [1] Group 2 - The joint CEO of SMIC indicates that the current market conditions are causing significant pressure on storage device production capacity [1] - The article suggests that the rising prices of storage devices may impact various sectors reliant on these components [1]

Group 1 - The core viewpoint is that the current memory market is experiencing a supply shortage, leading to significant price increases [1] Group 2 - Company executives from SMIC have indicated that the demand for memory products is outpacing supply [1] - The price of memory products has risen substantially due to this imbalance in supply and demand [1]

高盛：中芯国际第三季度收入高于市场预期，也超出了管理层5%-7%的季度预期；毛利率也高于指导 （18%-20%）和预期。中芯国第四季度营收预期为+0%~+2%，基本符合市场预期。在本地客户不断增 长的需求和人工智能相关机会的推动下，看好公司的长期增长。维持买入评级，目标价为117港元和人 民币211元。 ...

Financial Performance - Revenue for Q3 2025 was $2,382 million, up 7.8% QoQ from $2,209 million in 2Q25 and up 9.7% YoY from $2,171 million in 3Q24 [5, 11] - Gross margin was 22.0%, compared to 20.4% in 2Q25 and 20.5% in 3Q24 [6, 12] - Profit from operations was $351 million, compared to $151 million in 2Q25 and $170 million in 3Q24 [7, 13] - Profit attributable to SMIC was $192 million, compared to $132 million in 2Q25 and $149 million in 3Q24 [8, 14] - EBITDA was $1,430 million, compared to $1,129 million in 2Q25 and $1,157 million in 3Q24 [9, 15] Capital Structure and Cash Flow - Total cash on hand was $11,385 million as of September 30, 2025 [18] - Net cash generated from operating activities was $941 million for the three months ended September 30, 2025 [22] Revenue Breakdown - China accounted for 86.2% of total revenue in 3Q25 [26] - 12-inch wafers accounted for 77.0% of wafer revenue in 3Q25 [32] Capacity and Utilization - Monthly capacity reached 1,022,750 (standard logic 8-inch equivalent wafers) in 3Q25 [36] - Utilization rate was 95.8% in 3Q25 [36] Guidance - Revenue for 4Q 2025 is expected to be flat to +2% QoQ [40] - Gross margin for 4Q 2025 is guided to be between 18% and 20% [40]

Core Insights - SMIC reported a robust growth in Q3 2025, achieving record revenue and net profit, with capacity utilization nearing full capacity [1][2][5] Financial Performance - In Q3 2025, the company achieved revenue of RMB 171.62 billion, a quarter-on-quarter increase of 6.9% and a year-on-year increase of 9.9%, marking a new quarterly revenue high [3][4] - The net profit for the same period was RMB 15.17 billion, reflecting a year-on-year growth of 43.1% [3][4] - The gross margin stood at 25.5%, up 4.8 percentage points from the previous quarter [3][4] - For the first three quarters of 2025, total revenue reached RMB 495.10 billion, a year-on-year increase of 18.2%, with net profit at RMB 38.18 billion, up 41.1% [3][4] Capacity and Production - The company’s monthly capacity increased from 991,250 wafers in Q2 2025 to 1,022,750 wafers in Q3 2025, with a capacity utilization rate of 95.8%, up 17.8% year-on-year [10] - The total assets at the end of the quarter were RMB 3,513.68 billion, with net assets attributable to shareholders at RMB 1,511.80 billion [5][10] Revenue Breakdown - Revenue by region shows that China accounted for 86.2%, the US for 10.8%, and Eurasia for 3% [7] - In terms of application, revenue contributions were 21.5% from smartphones, 15.2% from computers and tablets, 43.4% from consumer electronics, 8.0% from connected and wearable devices, and 11.9% from industrial and automotive sectors [7][9] Future Guidance - For Q4 2025, the company expects revenue to remain flat or grow by 2%, with a gross margin guidance of 18% to 20% [11][12]