Manufacturing · Profile from Manufacturing Research Companion: Companies, Strategic Moves, and Technical Studies
SMIC (Semiconductor Manufacturing International Corporation)
China's largest contract chipmaker, founded in Shanghai in 2000 by the Taiwanese-American engineer Richard Chang (from memory, verify date), told here as a manufacturing story: how a foundry builds process capability under two constraints at once — trade-secret litigation from the company it set out to copy, and US export controls that from 18 Dec 2020 put it on the Entity List. SMIC lost two trade-secret cases to TSMC: it settled the first in 2005 (~$175m, computed from filings) and, after a California jury found against it on 4 Nov 2009, the second for $200m in cash plus shares and warrants (SMIC 6-K). It went on to make 7 nm-class chips without EUV lithography — the Kirin 9000S in Huawei's Mate 60 Pro (Aug 2023), and an improved N+3 process confirmed by TechInsights in the Kirin 9030 in Dec 2025 (equal to AI). Most of its output, though, is mature-node: in 2025 it posted record revenue of ~$9.33bn (+~16%) at a 21.0% gross margin, ran its fabs at 93.5% utilisation and ended the year with ~1.059m 8-inch-equivalent wafers a month of capacity (company via press). SMIC's story turns on process capability built under constraint, financed by the state: it can make advanced chips, but at lower yield and higher cost, and it fills its fabs by selling mature-node wafers in a market its own expansion has made crowded.
At a glance
- Founded
- 2000, Shanghai, by Richard Chang (ex-Texas Instruments; founder of Taiwan's Worldwide Semiconductor, which TSMC bought in 2000 — AI KB) (from memory, verify details)
- Headquarters
- Shanghai, China
- Ownership / structure
- Listed in Hong Kong (0981) and on Shanghai's STAR Market (688981; listed 2020, from memory, verify); NYSE ADSs delisted 2019 (from memory, verify). State-linked shareholders include the National Integrated Circuit Industry Investment Fund ("Big Fund"), Datang Telecom and Shanghai state investors (from memory, verify stakes)
- Leadership (2026)
- Co-CEOs Zhao Haijun and Liang Mong Song (ex-TSMC and Samsung) and chairman Liu Xunfeng (all from memory, verify current roles)
- Products
- Foundry services from 0.35 µm to 28 nm on 8-inch and 12-inch wafers, FinFET 14 nm and 7 nm-class (N+1, N+2, N+3) processes; customers in consumer, smartphone, industrial, automotive and computing (company; node list from memory, verify)
- Scale
- FY2025: revenue ~$9.33bn (+~16%; previous peak $7.27bn in 2022); profit attributable ~$685m (+39.1%); gross margin 21.0%; capex ~$8.1bn; utilisation 93.5%; shipments ~9.7m 8-inch-equivalent wafers; capacity ~1.059m 8-inch-equivalent wafers a month at year-end (+~110,000) (company via TrendForce, KR-Asia and others). Q2 2026: revenue ~$3.0bn (+20% q/q), gross margin 25.3%, utilisation 93.7%; Q3 2026 guide revenue +2–4% q/q, gross margin 26–28% (company, 13 Aug 2026)
- Capital / regulatory status
- On the US Entity List since 18 Dec 2020 (85 FR 83416), with affiliates; licence review for items for advanced nodes under a presumption of denial (from memory, verify scope); Dutch EUV licence lapsed 2019 (equal to AI); Taiwan export controls on SMIC and Huawei (Jun 2025, reported)
- Signature moves (incl. failures)
- Founding and the build-out (2000); the first TSMC trade-secret settlement (2005); the jury verdict and second settlement (2009, a failure); the Entity List (2020); the four new 12-inch fabs and mature-node expansion (2021–26); 7 nm-class Kirin chips for Huawei without EUV (2023); the SMIC North buyout (2025); record revenue, thin margins and the mature-node glut (2025–26)
8 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
2000
Founding in Shanghai
Founding
2005
First TSMC Trade Secret Settlement
Regulatory or legal action (trade-secret and patent litigation, settled)
2009
Jury Verdict and the Second TSMC Settlement
Regulatory or legal action (trade-secret verdict and settlement) — a failure
2020
Entity List Designation
Regulatory or legal action (export controls imposed)
2022
Four 12 Inch Fabs and the Mature Node Build Out
New plant or line (greenfield, four sites) / capacity expansion
2023
7nm Class Kirin 9000S Without EUV
Technology bet (advanced process without EUV)
2025
SMIC North Buyout
Acquisition or merger (buy-in of a 49% minority in a fab joint venture, paid in shares)
2026
Record Revenue Thin Margins and the Mature Node Glut
Pricing or capacity change (full fabs at low prices) — a mixed result