SMIC Expects AI Chip Shortage Into 2028

SMIC says the AI-driven semiconductor shortage is likely to persist through 2027 and may not ease broadly until mid-to-late 2028, with AI computing chips and supporting components potentially remaining scarce even as memory supply and demand move closer to balance. The company highlighted tight supplies of so-called peripheral chips, including power-management parts and controllers, as well as strong demand for AI processors. SMIC reported record third-quarter revenue of $3.19 billion and net profit of $428.4 million, while factory utilization climbed to 97.3%. The company said equipment orders now face lead times of roughly 16 to 24 months or longer, complicating procurement and potentially pushing some deliveries into 2027, though its 2026 capacity expansion remains on track. SMIC expects full-year 2026 revenue to exceed $12 billion, while warning that costs and equipment constraints could weigh on expansion plans.