Key facts
- China's semiconductor sector saw net profit jump 607.2% year-on-year to RMB 160.51 billion in the first half of 2026.
- Memory-related companies were the largest contributors to the earnings surge.
- CXMT led the sector in both revenue (RMB 150.31 billion) and net profit (RMB 77.61 billion) in 1H26.
- SMIC's net profit rose 94.2% year-on-year to RMB 44.67 billion in 1H26, with revenue up 19.4% to RMB 38.64 billion.
- AI demand and domestic substitution were key growth drivers for companies like Cambricon, SMIC, Tongfu Microelectronics, and JCET.
- NAURA and AMEC saw increased shipments and profits due to demand for etching and thin-film deposition equipment.
China's semiconductor industry experienced a dramatic surge in profits during the first half of 2026, with a combined net profit increase of 607.2% year-on-year, reaching RMB 160.51 billion. This bonanza was fueled by a confluence of factors including the booming artificial intelligence sector, a memory upcycle, and China's ongoing national campaign for technological self-sufficiency.
Memory-related companies were the primary drivers of this earnings growth. CXMT, China's sole domestic DRAM manufacturer, topped both revenue and profit rankings. The company reported RMB 150.31 billion in revenue, an 873.64% year-on-year increase, and RMB 77.61 billion in net profit, benefiting from tight global supply and rising prices. CXMT's fifth-generation DRAM platform, G5, has entered mass production, increasing gross die output per wafer by at least 50% from the previous generation.
SMIC, China's largest contract chipmaker, also saw significant gains, with revenue rising 19.4% to RMB 38.64 billion and net profit increasing 94.2% to RMB 44.67 billion in the first half of 2026. The company's performance was supported by strong demand for AI-related chips and its ability to negotiate price increases in product categories where demand outstrips supply. SMIC's gross margin for the period reached 23.2%, with guidance for the third quarter pointing to a record 26%-28%.
Other companies contributing to the sector's growth include NAURA, a semiconductor equipment leader whose revenue rose 24.90% to RMB 20.16 billion, and AMEC, which saw its net profit jump 300.22% due to increased shipments of etching equipment. AI computing demand also boosted companies like Cambricon, Tongfu Microelectronics, and JCET, while domestic substitution efforts provided further momentum across the supply chain.