SMIC trims capex outlook for 2007

November 6, 2006 – Chinese flagship foundry Semiconductor Manufacturing International Corp. (SMIC) plans to slash 30% from its capital expenditures next year from this year’s $1.0 billion, according to recent comments by chairman Richard Chang, noted the Taiwan Economic News.

SMIC also indicated it will quadruple its portion of revenues from 90nm process technologies to 16% by year’s end, although partly because of declining orders for trailing-edge 0-15-0.18-micron process capacities and ASPs. SMIC’s revenue in 3Q increased 21% sequentially, with logic chips making up nearly two-thirds of sales vs. memory, but margins dropped to 8.9% from 13.6%.

Chang projected 4Q revenues will rise 1%-2% sequentially, with gross margins picking up to 9%-11%.


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