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China's SMIC Surges in Global Foundry Market Share Ranking

By
Fatima Attarwala
Fatima Attarwala Fatima Attarwala
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Fatima Attarwala is a business news writer and editor with a decade of experience researching, analyzing, and commenting on issues influencing the economy.
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Published May 23, 2024
SMIC plant in Shenzhen, China. SMIC plant in Shenzhen, China.

Qilai Shen / Bloomberg via Getty Images

KEY TAKEAWAYS

  • Beijing-backed chipmaker Semiconductor Manufacturing International Co., or SMIC, became the world’s third-largest foundry in terms of revenue in the first quarter, according to Counterpoint Research.
  • The Trump administration added SMIC to an export blacklist in 2020, restricting the company’s access to high-end technology over its alleged links to the Chinese military.
  • Earlier this month, the Biden administration escalated tariffs on a wide range of Chinese imports, with the tariff rate on chips increasing to 50% by 2025 from 25%.

China’s largest chipmaker, Semiconductor Manufacturing International Co., or SMIC, became the world’s third-largest foundry in terms of revenue in the first quarter, according to Counterpoint Research, trailing Taiwan Semiconductor Manufacturing Company (TSM) and South Korea's Samsung Foundry.

TSMC took the top spot with 62% of market share during the quarter, and Samsung was in second place at 13%. SMIC and Taiwan's United Microelectronics Corporation (UMC) both had a 6% share.

SMIC Overtakes GlobalFoundries in Market Share

SMIC, which is backed by Beijing, was in fifth place last quarter with a 5% market share, and has now overtaken GlobalFoundries (GFS), which has slipped to fifth place from third with a 5% share. Beijing has been trying to boost its domestic tech sector by enforcing new restrictions on government purchases of chips and operating systems by foreign companies. 

The Trump administration added SMIC to an export blacklist in 2020, restricting the company’s access to high-end technology over its alleged links to the Chinese military.

Earlier this month, the Biden administration escalated tariffs on a wide range of Chinese imports, and said the tariff rate on semiconductors will increase to 50% by 2025 from 25%. The White House has also doled out billions of dollars under the CHIPS and Science Act to expand the manufacturing of advanced chips at home. 

GlobalFoundries shares were down 7.8% to $50.91 as of 11:52 a.m. ET Thursday, while TSMC's American depositary receipts (ADRs) were up 1.9% to $159.04. Both are beneficiaries of the CHIPS Act.

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  1. Counterpoint Research. "AI Demand Stands Strong Amidst Seasonal Downturn and Slower Recovery for Global Foundry Industry in Q1 2024."

  2. The Wall Street Journal. "U.S. Blacklists China’s Top Chip Maker, Escalating Tech Fight."

  3. White House. "FACT SHEET: President Biden Takes Action to Protect American Workers and Businesses from China’s Unfair Trade Practices."

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