It's just that Lu Feng no longer needs to deal with this kind of competitive tactic.
Throughout December, mobile phone manufacturers bombarded the market with advertisements, and any problem with Giti Mobile was seized upon and amplified by competitors, followed by headlines. Dealing with these unexpected situations was enough to keep Zhu Lidong extremely busy.
Du Guoying frequently participated in various activities to promote Giti mobile phones, while Lu Feng stopped making public appearances, leaving the promotion of Giti mobile phones entirely to the two of them.
In mid-January, Lu Feng went to Tianjin for a meeting, mainly to discuss the semiconductor R&D and sales situation in 1999. This time, almost everyone was present. He inspected the factory for a day and briefly looked at the various iterative products. Compared with many years ago, the progress was very significant.
At the meeting, Lu Feng set the R&D expenses at 130 million US dollars. According to Hurricane Capital's overall profitability, the shortfall this year will not be too large. These expenses will be used not only to catch up in cutting-edge industries, but also for the development of various chips. By the end of this year, Hurricane Semiconductor will reach cooperation agreements with China Unicom and China Telecom to produce 2G SIM cards for the two companies.
Compared to products like chips and memory, the best-selling product that year was actually the panel, which accounted for 35% of the profits, while the core chip business accounted for less than 7% of the total profits.
"Last year was an important year for Hurricane Semiconductor. We ended our losses, iterated all our products, and caught up with world-class standards in multiple products such as processors, memory, communications, digital decoding, and wafers. At the same time, we have cooperated with many companies around the world and established talent transfer programs with 25 universities in China."
"We have eleven R&D centers worldwide, with R&D personnel officially exceeding five thousand. We have also established partnerships with many overseas manufacturers. This year's progress is due to our continuous accumulation of previous efforts. We hope everyone will continue to work hard in the new year. This year, our LCD screens will be launched and sold, and we will continue to push forward various products. We hope that this year, our net profit will be able to fully cover our R&D expenses."
A round of applause erupted from the audience.
At the meeting, Lu Feng also called for efforts to promote the joint R&D center with Sharp and Rohm, aiming to establish it this year, and set goals for various projects.
After so many years of hard work, Hurricane Semiconductor has finally matured. Looking at the thick year-end report in front of him, Lu Feng felt quite gratified. Hurricane now has the ability to independently design, independently develop, and independently manufacture, capabilities that no other domestic manufacturer possesses.
Moreover, the vast majority of these are self-developed patents. If we're talking about what will be able to restrict the domestic chip industry in the future, it will only be software and hardware like EDA and lithography machines.
However, when Lu Feng held a meeting in Beijing last year, he mentioned supporting companies related to chip design software development, circuit design software, lithography machines, etching machines, etc.
After the meeting, Zhang Rujing approached Lu Feng and asked, "Mr. Lu, is this year's R&D budget for wafers too low?"
“The eight-inch wafers have just started mass production, and the company’s funds are indeed quite tight. We need to consolidate the eight-inch wafer production first,” Lu Feng replied, looking at him to understand his thinking.
“Twelve-inch wafers are something all companies are chasing. We’ve finally caught up, so we can’t let our guard down. I understand the company’s financial situation.” He sat down, looking somewhat hesitant.
"Speak your mind. I'm not saying that I have to put the interests of the company first, but rather the interests of the industry." Lu Feng had heard Liu Cheng mention before that when he went to a meeting, he suggested to the leaders to establish a semiconductor fund, with the state leading the investment, and also hoped to classify the industry.
To avoid one company doing all the work, firstly, it would lead to a monopoly problem, and secondly, a clear division of labor in the industry is more conducive to overall development. The semiconductor industry is one that requires division of labor and cooperation.
"I want to leave Hurricane Semiconductor and start a professional wafer foundry to cultivate the industry. Once such companies emerge, they can complement Hurricane Semiconductor," Mr. Zhang said frankly.
Lu Feng nodded and said, "I support you. If you need funds, I can invest personally. By the way, I'll help you come up with a name, let's call it SMIC."
"This name is great!" he said with a hint of surprise.
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