China’s chip champion had some bumper years thanks to the pandemic. Now it has to grapple with two big problems at once: a drop-off in demand and intensifying geopolitical risks.
Semiconductor Manufacturing International China’s top contract chip maker, warned Friday of a chip downturn ahead after it reported slowing revenue for the quarter ended in June. The company’s sales in that April-June period rose 3.3% quarter on quarter. It expects growth to slow further between 0% and 2% this quarter. SMIC benefited enormously from the chip shortage of the past couple of years: Its revenue last quarter was more than double that of the same period in 2019.