SMIC Says Foreign Clients Shift Chip Orders Back to China as AI Demand Tightens Foundry Capacity

Semiconductor Manufacturing International Corp. said May 15, 2026, that overseas customer orders are rising as AI-related chip demand absorbs capacity at foreign foundries, pushing more legacy chip production to China. Co-CEO Zhao Haijun said SMIC, China’s largest contract chipmaker, is capturing a large share of the shift because domestic fabs still have available capacity. He said some products previously made overseas are no longer being produced there as manufacturers prioritize AI, memory and high-bandwidth applications. SMIC added 9,000 12-inch equivalent wafers of capacity in the first quarter, while utilization was 93%, slightly below the fourth quarter. First-quarter depreciation and amortization rose 26% from a year earlier, and SMIC expects full-year depreciation expense to increase about 30%. China accounted for 89% of first-quarter revenue, while the U.S. contributed 9%. The company shipped 2.5 million 8-inch equivalent wafers, unchanged from the prior quarter.