Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC) reported a jump of 261.7 percent in its second-quarter net profit, with revenue topping $3 billion. SMIC co-CEO Zhao Haijun on Friday attributed the sharp growth to surging demand for artificial intelligence (AI)-related supporting chips.

SMIC will increase prices of wafers in the third quarter, expecting to boost its gross profit rate, while AI chip demand is expected to increase 40 percent, with wafer shipments set to grow, according to Zhao.

SMIC released its 2026 second-quarter results on the Hong Kong stock market on Thursday, with multiple key metrics hitting record highs. Revenue for the second quarter reached $3.006 billion, up 36.1 percent year-on-year, marking the first time quarterly revenue surpassed the $3 billion threshold. Net profit attributable to shareholders came in at $479 million, soaring 261.7 percent year-on-year.

By region, China, the US, and Eurasia accounted for 90 percent, 8 percent, and 2 percent of revenue in the second quarter. China recorded the largest growth at 22 percent, mainly thanks to robust demand for AI supporting chips, the return of overseas orders, and the continued strengthening of localized manufacturing, Zhao said.

The financial results significantly beat market expectations. Goldman Sachs noted in a report that SMIC's second-quarter revenue and gross margin both came in above the bank's and the market's forecasts, as well as management's earlier guidance. Goldman Sachs maintained its "buy" rating and set a target price of HK$135 ($17.2) for the Hong Kong-listed shares.

During the morning trading session on Friday, SMIC's share price stood at HK$71.8 at its highest, up about 6 percent after the latest financial results were released.

Zhao explained that both wafer shipment volume and average selling price rose in the second quarter - shipments increased 14.4 percent quarter-on-quarter, while average wafer selling price climbed 5.7 percent. "The growth in shipments was mainly driven by surging demand for AI supporting chips and customers pulling forward orders," Zhao said.

"Chinese internet companies have significantly increased their hardware investments beyond our previous forecasts. When discussing future cooperation with customers, we can clearly sense that their subsequent order volumes far exceed original expectations," Zhao revealed.

Looking ahead to the third quarter, the company expects shipments to continue growing and prices to remain stable. Industrial momentum and spillover effects from AI will continue in the second half of the year, generating broad demand for integrated-circuit manufacturing. "The company remains optimistic about the industry outlook and its own development," said Zhao.