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SMIC Reports 93.7% Capacity Utilization Amid Rising Demand for AI-Driven Chip Production
Original from InterestingEngineering.com: Chinese firm sees 93.7% capacity utilization as modern tech demand drives chip shortages

SMIC Reports 93.7% Capacity Utilization Amid Rising Demand for AI-Driven Chip Production

China's Semiconductor Manufacturing International Corporation (SMIC) has reported a capacity utilization rate of 93.7% in the second quarter, up from 93.1% previously. This increase is attributed to a surge in demand for mature-node chips, particularly for AI infrastructure, as the company aims to expand its manufacturing capabilities to meet this growing need.

The rising demand for AI-related supporting chips has highlighted significant gaps in manufacturing, prompting SMIC to consider installing additional equipment at its facilities. Co-CEO Zhao Haijun noted that future wafer starts are exceeding previous expectations, indicating a robust market for logic chips, power-management products, and optical module components.

Looking ahead, SMIC plans to invest in research and development to enhance its production capabilities without reaching full operational limits. While some prices for consumer electronics have increased, smartphone chips and display-driver integrated circuits remain unchanged. The company anticipates further price adjustments as market volatility continues to impact supply and demand dynamics.

Editor's Note

The semiconductor industry is currently navigating a complex landscape characterized by heightened demand for AI technologies. SMIC's strategic focus on expanding its manufacturing capabilities reflects a broader trend among chipmakers to adapt to the evolving needs of the market. As AI infrastructure continues to grow, companies will need to balance capacity expansion with sustainable operational practices to remain competitive.

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