(Reuters) -Semiconductor Manufacturing International Corp on Thursday lifted its annual capital expenditure forecast to around $7.5 billion and said it expects lower fourth-quarter gross margins.
The Chinese chip foundry also reported an over 80% fall in its third-quarter profit attributable to $470.8 million, joining peers such as Taiwan’s TSMC and Germany’s Siltronic in facing earnings pressure from a slowdown in the semiconductor industry.
High interest rate and persistent inflation have forced businesses to tighten their tech budgets, while U.S. restrictions on Chinese chip companies are also weighing on the sector.
SMIC expects a gross margin of between 16% and 18% in the fourth quarter, compared with 19.8% in the third quarter.
Revenue for the third quarter fell to $1.62 billion from $1.91 billion a year ago, but the company expects a sequential increase of 1% to 3% in the fourth quarter.
SMIC had previously said it expects capital expenditure in 2023 to be roughly flat compared with 2022, which came in at about $6.35 billion.
(Reporting by Nausheen Thusoo in Bengaluru; Editing by Devika Syamnath)