Trend analysis based on the updated indicator.
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Core Overview:
According to the latest data provided by DataTrack, Semiconductor Manufacturing International Corporation (SMIC) achieved an average of 4,000 NAND Flash wafer starts (12-inch equivalent) per month in the first quarter of 2025, a significant growth of 33.3% compared to 3,000 wafers in the fourth quarter of 2024. This outstanding performance not only breaks the prolonged trough of remaining stagnant at 3,000 wafers for eight consecutive quarters since the first quarter of 2023, but also heralds the official restart of memory-related foundry momentum.
Key Details:
Deconstructing the industry dynamics, this jump in wafer starts is highly correlated with NAND Flash pricing and capacity reallocation. Research institute TrendForce points out that, benefiting from North American CSPs increasing their AI infrastructure investments, the surging demand for enterprise SSDs has crowded out other capacity, driving up NAND Flash contract prices by a massive 33% to 38% in the first quarter. Catalyzed by soaring prices and aggressive customer restocking, SMIC capitalized on the trend by reallocating some capacity to platforms with strong demand, driving an expansion in wafer start scale.
In-Depth Attribution:
Exploring the core driving forces behind this, it primarily stems from the dual superposition of the "AI siphon effect" and "supply chain localization." SMIC's management publicly stated that as major overseas foundries aggressively shift their capacity to high-margin AI chips and advanced processes, mature processes have begun to experience shortages, forcing consumer electronics and IoT clients to shift their orders extensively to domestic foundries in mainland China. This overseas capacity crowding-out effect has created massive incremental space for SMIC, pushing up its overall utilization rate.
Outlook and Risks:
Looking at the short term (1-2 months), under the landscape of strict supply control by NAND original manufacturers and sustained strength in contract prices, SMIC's wafer start scale is expected to stabilize at a high level of 4,000 wafers per month and enjoy better product pricing power. However, in the medium term (3-6 months), although the demand for AI server infrastructure remains robust, the continuity of the recovery in general consumer electronics end markets still requires attention. Concurrently, the potential escalation of US export controls on semiconductor equipment to China remains the biggest risk variable dictating SMIC's subsequent expansion pace and the endurance of its wafer start volume.
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