SMIC sees prolonged chip glut, signals cautious expansion outlook
BEIJING -Semiconductor Manufacturing International Corp, China's largest chipmaker, warned on Friday that overcapacity in mature node chips will persist through 2025 and that it was turning cautious on building new capacity.
"Industry utilisation rates are hovering around 70%, well below the optimal level of 85%, indicating significant overcapacity. This situation is unlikely to improve significantly, if not worsen further," co-CEO Zhao Haijun said in the company's third-quarter earnings call. However, Zhao said this substitution trend would slow in 2025 as domestic suppliers have already captured a substantial portion of the market.
"We have not announced any new projects, and we are not currently discussing any new ones," Zhao said, marking a potential shift in strategy for China's largest contract chipmaker.
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