Semiconductor Manufacturing International (981) Q4 2023 earnings summary

Executive summary

• Q4 2023 revenue rose 3.6% QoQ and 3.5% YoY to $1.678B, while gross margin fell to 16.4% from 19.8% in Q3 and 32.0% in Q4 2022.

• FY2023 revenue was $6.322B versus $7.273B in 2022; attributable profit was $903M versus $1.818B.

Financial highlights

• Q4 operating profit was $107M, versus $87M in Q3 and $282M in Q4 2022; attributable profit was $175M, versus $94M and $386M, respectively.

• Q4 EBITDA was $1.011B, versus $901M in Q3 and $1.063B in Q4 2022.

• FY2023 gross margin was 19.3% versus 38.0%; operating profit was $358M versus $1.836B; EBITDA was $4.064B versus $4.611B in 2022.

• Q4 revenue increased mainly on higher wafer shipments; G&A expense rose to $147.8M from $128.1M in Q3, mainly due to new fab start-up costs.

Outlook and guidance

• Q1 2024 revenue guidance: flat to +2% QoQ; gross margin guidance: 9%–11%.

• FY2024 revenue growth expected to be at least the industry average in the same markets and around mid-single-digit YoY; capex expected roughly flat versus 2023.

• Q4 revenue of +3.6% QoQ exceeded guidance of +1% to +3%; gross margin of 16.4% was within the 16%–18% range.