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Global smartphone sales will drop by at least 200 million units in 2022

Global smartphone sales will drop by at least 200 million units in 2022

Recently, SMIC held an earnings conference for the first quarter of 2022. SMIC’s revenue in the quarter was 11.854 billion yuan, a year-on-year increase of 62.6%. Its net profit is 2.843 billion yuan, a year-on-year increase of 175.5%. Furthermore, the company’s gross profit margin exceeds 40%. In the first quarter of 2022, SMIC’s R&D investment is 1.051 billion yuan, a year-on-year increase of 3.4%. It accounts for 8.9% of the company’s total revenue. However, it is SMIC’s statement on the global smartphone market that attracted the attention of the industry. The company claims that global smartphone sales will drop by at least 200 million units. Recall that a report from last month claims that global manufacturers will cut smartphone production by 200 million units.

Declining global smartphone sales – Chinese brands to bear more of the brunt

Regarding the decline in the smartphone terminal business, Co-CEO Zhao Haijun claims that due to the Ukraine war, the impact on mobile phone brands was great. The sales in many regions is completely crumbling. From his point of view, global smartphone sales will drop by at least 200 million units. Furthermore, he also reveals that Chinese smartphone brands will bear most of the loss.

The reduction in global smartphone sales also has a link to production. There will be a reduction in production because of chip shortages. Chips such as power management, MCU, Wi-Fi, etc. are still in short supply.

Zhao Haijun claims that SMIC has many characteristic processes. The 40nm, 28nm and other processes are built later than peers, and the construction of factories is not based on nodes but on processes. In its separate factory, 55nm, 40nm, 28nm, and 22nm are all made. The specific node wafer statistics are difficult and have low practical significance. Today, it puts more emphasis on SMIC’s market share and technical reserves in specific terminal fields.

In the first quarter of this year, SMIC added 28,000 wafers equivalent to an 8-inch wafer production capacity. By the end of this year, the production capacity increase will exceed last year. In this quarter, SMIC’s 8-inch wafers account for 33.5%. Furthermore, its 12-inch wafers account for 66.5%. In comparison with the fourth quarter of 2021, the proportion of SMIC’s 12-inch wafers increases by 2 percentage points.

By region, SMIC’s most important shipments this quarter are Mainland China and Hong Kong. “North America”, and “Europe and Asia” are SMIC’s second and third largest markets, respectively. Overall, the proportion of revenue in mainland China and Hong Kong markets is still increasing.

Wafer production capacity suffers – supply chain delivery delays

There is a consistent increase in the release of top products with significant upgrades. This means that there is a change in the general trend. There is an increase in cloud storage volume and rising demand for automotive electronics.

In contrast, the average growth of…

Read Full Story At: GizChina.

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