SMIC (Semiconductor Manufacturing International Corporation) is China's largest and most advanced semiconductor foundry. It manufactures chips across a range of process nodes for customers in mobile, consumer, industrial, and AI applications. SMIC operates as the domestic Chinese alternative to TSMC and Samsung for customers within China, and its advanced process capabilities define the ceiling of what Chinese AI chip designers can build domestically.

SMIC's most advanced process node, referred to as N+2, is a 7nm-equivalent process developed using deep ultraviolet (DUV) lithography rather than EUV—a constraint imposed by US export controls preventing ASML from shipping EUV machines to Chinese customers. This process has limitations relative to true 7nm EUV-based nodes in yield and density, but it is the most advanced manufacturing technology available to Chinese chip designers. Huawei's Ascend AI accelerator chips, deployed in Chinese AI infrastructure, are produced at SMIC using this process.

Revenue has grown as Chinese AI chip companies have redirected production to domestic fabs following US restrictions on foreign foundry access. SMIC is the sole option for customers requiring advanced logic production within China, making its capacity a strategic resource for the domestic AI hardware ecosystem. The company faces constraints in advancing beyond N+2 without access to EUV equipment, limiting the pace at which it can match leading-edge foreign foundries.