On November 12, SMIC released its financial report for the period from July to September 2026, and the figures were quite impressive.
The net profit amounted to 428.4 million US dollars, which is 2.2 times the amount in the same period last year; revenue reached 3.19 billion US dollars, showing a 34% increase. Both the volume and price increased – more products were sold, and the average price per unit also rose.
The driving force remains AI. With a severe shortage of semiconductors across the industry, SMIC has primarily increased its supply to the domestic market. Domestic AI chips, as well as the accompanying power management and storage control chips, are all waiting in line for production capacity to become available.
What is even more noteworthy is the judgment made by Co-CEO Zhao Haijun at the press conference on the 13th: AI is still in its development phase, and the supply of related chips currently cannot meet demand; a severe shortage will persist until 2027; it will not be until mid-2028 at the earliest that the supply and demand for memory devices will begin to balance out.
Put it in terms that ordinary people can understand: Memory and graphics cards are expensive, and their prices won’t drop in the short term. This year, mobile phone and computer manufacturers have frequently adjusted their product prices, and Apple has changed its trade-in valuation policies seven times within a single year – all of these actions are directly related to the tight supply chain in this industry.
For domestic companies focused on developing large-scale models, this financial report indicates that the production capacity of domestically produced computing power is indeed increasing. However, the fact that there is still a shortage suggests that the day when we can have whatever amount of computing power we need is still far away.