--- title: "SMIC’s revenue rose 33.9% to US$3.19bn; it guides its margin to 26–28% from 29.9%" summary: "SMIC’s results for July to September and its guide for the next quarter: why the margin rose, where the wafers went, how full its fabs ran, and what October to December is set to bring." url: https://www.thetechbag.com/blog/smic-revenue-34-percent-margin-guide-26-28 format: Note desk: "Markets & the AI economy" region: Global published: 2026-11-12 facts_checked: 2026-11-12 author: TechBag (The TechBag Journal) tags: ["SMIC results","SMIC Q3 earnings","SMIC gross margin","China chipmaker results","SMIC Q3 results","SMIC guidance","SMIC","Semiconductor Manufacturing International","foundry","chip foundry","wafer shipments","capacity utilisation","gross margin","semiconductors","China","Hong Kong","STAR Market","earnings"] cover: https://www.thetechbag.com/blog/covers/smic-revenue-34-percent-margin-guide-26-28.png --- # SMIC’s revenue rose 33.9% to US$3.19bn; it guides its margin to 26–28% from 29.9% *SMIC’s results for July to September and its guide for the next quarter: why the margin rose, where the wafers went, how full its fabs ran, and what October to December is set to bring.* Note · Markets & the AI economy · By TechBag · Published 2026-11-12 · Facts checked 2026-11-12 · Canonical: https://www.thetechbag.com/blog/smic-revenue-34-percent-margin-guide-26-28 SMIC, the Shanghai chip foundry, made US$3.19bn of revenue in July–September, 33.9% more than a year earlier, and kept 29.9% of it as gross margin, up from 22.0%. Gross profit rose 82.3%, to US$953.2m.[2] For October–December it guides revenue up 4% to 6% on the quarter and gross margin to 26–28%, below the quarter it has just reported.[1] SMIC published the results on 12 November, after Hong Kong’s market had closed.[2] US$3.19bn revenue, July–September, up 33.9% on a year earlier SMIC 29.9% gross margin, from 25.3% in April–June and 22.0% a year earlier SMIC 97.3% of its capacity in use, from 93.7% in April–June SMIC 26–28% gross margin SMIC guides for October–December SMIC ## Why the margin rose: full fabs A foundry makes chips that other companies design, so much of its cost is the fabs themselves, written off as depreciation whether they run full or not: US$945.8m of SMIC’s US$2.24bn cost of sales in the quarter, 42%. Its total depreciation and amortisation reached US$1.27bn, up 27.6% on a year earlier.[2] When more wafers go through the same fabs, that fixed cost is spread wider: SMIC shipped 3.03 million wafers (counted as 8-inch equivalents), 5.7% more than in April–June, and ran at 97.3% of capacity, against 93.7%. Revenue rose 6.1% on the quarter while cost of sales fell 0.4%. SMIC puts the margin gain down to the higher utilisation rate and a change in product mix.[2] Monthly capacity grew to 1,116,750 8-inch-equivalent wafers, from 1,096,500.[2] **Figure: SMIC’s gross margin rose from 19.2% to 29.9% in three quarters as revenue passed US$3bn** *Quarterly revenue (US$ million) and gross margin (%), October–December 2024 to July–September 2026* | | Revenue (US$m) | Gross margin (%) | | --- | --- | --- | | 4Q24 | 2,207.3 | 22.6 | | 1Q25 | 2,247.2 | 22.5 | | 2Q25 | 2,209.1 | 20.4 | | 3Q25 | 2,381.8 | 22 | | 4Q25 | 2,488.7 | 19.2 | | 1Q26 | 2,505.5 | 20.1 | | 2Q26 | 3,005.6 | 25.3 | | 3Q26 | 3,190 | 29.9 | Source: SMIC quarterly results releases, 10 February, 14 May, 13 August and 12 November 2026 · as of 12 November 2026 · each quarter as SMIC reported it; IFRS The quarter beat SMIC’s own forecast. In August it guided revenue up 2% to 4% and gross margin to 26–28%;[3] it delivered 6.1% and 29.9%.[1] The quarter before went the same way: guided in May to a 20–22% margin,[5] SMIC reported 25.3%.[3] For TSMC, the largest foundry, monthly sales are in [our Trend on its October record](https://www.thetechbag.com/blog/tsmc-october-record-assemblers-ai-server-revenue). ## Where the wafers go China accounted for 90.8% of SMIC’s revenue, up from 86.2% a year earlier; America’s share fell to 7.8% from 10.8%. By what the chips go into, smartphones fell to 14.3% of wafer revenue from 21.5%, while industrial and automotive rose to 19.3% from 11.9%, and computers and tablets to 18.3% from 15.2%. Consumer electronics stayed the largest group, at 40.6%. Twelve-inch wafers made up 78.9% of wafer revenue.[2] ## Profit, cash and what to watch Profit attributable to SMIC’s shareholders was US$428.4m, 123.4% more than a year earlier but 10.6% less than in April–June, when gains on investments held through associates added US$275.9m of other income; this quarter that line was a US$32.1m loss.[2] Capital spending was US$1.09bn, against US$1.84bn in April–June. Borrowings rose to US$14.9bn, against US$13.4bn of cash and deposits.[2] TechBag countWhat the guide implies Up 4% to 6% on US$3,190.0m puts October–December revenue at about US$3.32bn to US$3.38bn. A 26–28% margin is 1.9 to 3.9 points below the 29.9% just reported.[1] The release does not say why the margin guide is lower, and the filing gives no split by process node. SMIC holds its call on 13 November.[1] In February it guided 2026 revenue growth above the industry average in its markets, with capital spending roughly flat on 2025.[4] How we did this Figures as of 12 November 2026, 8:30pm IST Every figure is SMIC’s, in US dollars under IFRS. Third-quarter detail (regions, applications, capacity, shipments, utilisation, capex, profit, cash and debt) is from the Hong Kong exchange announcement, which reproduces the press release and adds the tables. The chart’s eight quarters come from SMIC’s quarterly releases, each with its prior-year comparatives; we have not adjusted for later restatements. Our arithmetic: the implied fourth-quarter range (US$3,190.0m times 1.04 and 1.06), the margin gaps in points, and depreciation’s 42% share of cost of sales. The exchange filing is timed 5:40pm Hong Kong time, after the day’s trading had ended. SMIC’s own web copy of the release heads its third-quarter figures “Second Quarter 2026 Highlights”; the exchange copy has no such heading, and the figures are those for the three months to 30 September. Its web copies of the first- and second-quarter releases also carry 2025 in their datelines; SMIC’s release list dates them 14 May and 13 August 2026. Spotted an error? Write to us; corrections are published at the foot of the piece. Sources 1. [SMIC: SMIC reports 2026 third quarter results (press release)](https://www.smics.com/en/site/news_read/7964) — 12 November 2026 2. [SMIC: SMIC reports unaudited results for the three months ended September 30, 2026 (HKEX announcement, stock code 00981)](https://www1.hkexnews.hk/listedco/listconews/sehk/2026/1112/2026111200682.pdf) — 12 November 2026 3. [SMIC: SMIC reports 2026 second quarter results (press release)](https://www.smics.com/en/site/news_read/7959) — 13 August 2026 4. [SMIC: SMIC reports 2025 fourth quarter results (press release)](https://www.smics.com/en/site/news_read/7949) — 10 February 2026 5. [SMIC: SMIC reports 2026 first quarter results (press release)](https://www.smics.com/en/site/news_read/7956) — 14 May 2026 **Disclosure.** TechBag is a software reseller: it earns when companies buy through it, including from vendors named here. The analysis is TechBag’s own; no vendor paid for or saw this piece before publication. Facts are labelled reported, TechBag count or our view. **Read this next:** [TSMC hit a record NT$586.9bn in October; four of five assemblers peaked earlier](https://www.thetechbag.com/blog/tsmc-october-record-assemblers-ai-server-revenue) — The largest foundry’s month: TSMC hit a record NT$586.9bn in October, set against five Taiwanese server assemblers’ monthly revenue. Go deeper on TechBag - [Supermicro’s sales grew 298% at a 13% margin; Arista’s grew 58% at 64%](https://www.thetechbag.com/blog/ai-hardware-suppliers-revenue-who-keeps-margin) — growth against gross margin at other hardware makers - [TSMC approved US$40.9bn for capacity](https://www.thetechbag.com/blog/tsmc-capex-40-9bn-anthropic-openai-shares) — the capital spending of the largest foundry - [Nifty’s best week in five years as chip stocks fell 12%](https://www.thetechbag.com/blog/nifty-best-week-fpis-buy-as-chip-index-falls) — how chip shares moved in early November