China-based pure-play foundry Semiconductor Manufacturing International (SMIC) expects to post revenue growth of 5-7% sequentially in the fourth quarter of 2016, with gross margin of 28-30%.

SMIC reported revenues climbed to a record US$774.8 million in the third quarter of 2016. Revenues for the quarter represented increases of 12.3% sequentially and 36% from a year ago. The foundry's gross margin slid to 30% in the quarter from 31.6% in the second quarter and 32% in the third quarter of 2015.

"SMIC is seeing robust demand across the board and we reiterate our growth target of 20% compounded annual growth from 2016 to 2019," said company CEO and executive director Tzu-Yin Chiu. "In 2016, SMIC is growing in excess of 28% year on year. We are forecasting growth for both 4Q16 and 1Q17 given current visibility."

Net profits for the third quarter attributable to SMIC were US$113.6 million, rising 37.4% from the same period in 2015 and 16.3% on quarter. "This marks the first time our quarterly net profit exceeds US$100 million," Chiu continued.

"We are still experiencing robust demand from various regions, applications and nodes," Chiu noted. "In the last month, we announced several new fab construction projects to address our diverse demand."

SMIC recently announced it had started to build a 12-inch IC production line at its manufacturing site in Shenzhen, which the company claims will be the very first 12-inch fab in South China. In October, SMIC disclosed an expansion project for its Tianjin facility, which the foundry claims will become the world's largest 8-inch wafer fab. And earlier in October, SMIC held a groundbreaking ceremony for a new 12-inch wafer fab in Shanghai.

By: DocMemory
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