Chang Jiang Shang Bao·2025-08-11 00:42Core Viewpoint - Semiconductor foundry company SMIC reported better-than-expected operating performance for Q2 2025, with a slight revenue decline compared to Q1 but significant year-over-year growth [2][3][6]. Financial Performance - In Q2 2025, SMIC achieved sales revenue of $2.209 billion, a decrease of 1.7% from Q1 2025's $2.247 billion, but an increase of 16.2% compared to Q2 2024 [2][3]. - The net profit attributable to shareholders for Q2 2025 was $132 million, down 29.5% from $188 million in Q1 2025, and down 19.5% from $165 million in Q2 2024 [4][6]. - For the first half of 2025, the total net profit was $320 million, approximately 39% year-over-year growth [2][4]. Capacity and Utilization - SMIC's capacity utilization rate reached 92.5% in Q2 2025, indicating high demand, with orders exceeding capacity until October [2][7]. - The company had capital expenditures totaling $3.3 billion in the first half of 2025, with R&D expenses of $331 million [2][8]. Revenue Breakdown - Revenue from the Chinese market accounted for 84.1% in Q2 2025, while the U.S. and Eurasian markets contributed 12.9% and 3.0%, respectively [3][4]. - The majority of revenue came from wafer services, comprising 94.6% in Q2 2025 [3][4]. Cost and Profitability - General and administrative expenses increased to $189 million in Q2 2025, a rise of 26.5% from Q1 2025 [4][6]. - The gross margin for Q2 2025 was 20.4%, down from 22.5% in Q1 2025 but up from 13.9% in Q2 2024 [4][6]. Future Outlook - For Q3 2025, SMIC provided revenue guidance of a 5% to 7% increase and a gross margin forecast of 18% to 20% [8]. - The company continues to invest heavily in R&D to enhance its technology and service capabilities, with a total of $331 million spent in the first half of 2025 [7][8].