In the report by Citigroup, SMIC's first-quarter revenue guidance meets market expectations, while the gross margin guidance is slightly disappointing

AASTOCKS
2026.02.11 03:22

Citi Research report indicates that SMIC (00981.HK) will see a quarterly revenue increase of 4.5% to USD 2.49 billion in Q4 2025, surpassing the growth guidance of 0% to 2%. The gross margin during this period is expected to be 19.2%, approximately at the midpoint of the guidance range of 18% to 20%. The average selling price is projected to rise by 1% quarter-on-quarter to USD 914 per wafer.

The company guidance for Q1 2026 indicates flat revenue quarter-on-quarter, in line with market expectations; however, the gross margin guidance is set at 18% to 20%, slightly lower than the market expectation of 20.9%. The company anticipates that its full-year revenue growth in 2026 will exceed the industry average, with capital expenditure guidance roughly in line with USD 8.1 billion in 2025.

Citi now sets a target price of HKD 93.3 for SMIC H shares and a target price of RMB 152 for SMIC (688981.SH) A shares, both rated "Outperform."

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