European chipmakers faced a dip in their stock prices on Friday, mirroring the fall in some Asian semiconductor companies. This decline comes after China's Semiconductor Manufacturing International Corp (SMIC) reported an 80% decrease in its quarterly income. SMIC's profit attributable to owners dropped to approximately $94 million in the three months ending September 30, a significant decline from the $470.8 million recorded in the same period last year. Additionally, the company's quarterly revenue decreased by 15% to $1.62 billion, and its gross margin nearly halved to 19.8% from 38.9% in the previous year. The chipmaker also predicted an even lower gross margin in the fourth quarter and highlighted higher capital expenditures for 2023. These projections were made due to a drop in capacity utilization caused by sluggish demand for semiconductors. Following SMIC's announcement, its Hong Kong shares experienced a 6.8% decline, while shares of rival company Hua Hong Semiconductor Ltd plummeted over 15%. The impact of these losses spread to Europe, where semiconductor equipment maker ASML, the largest tech firm on the continent, saw a slight decrease in mid-morning trading. Other European chipmakers, such as Infineon Technologies and STMicroelectronics, also experienced slumps of over 2%, while ASM International in the Netherlands lost 1.6%. SMIC's disappointing results come after TSMC, Samsung, and SK Hynix reported dismal quarterly performances, indicating a sustained weakness in global chip demand. Additionally, ASML reported lower-than-expected orders in its latest quarter and issued a rare warning regarding an uncertain recovery in customer spending. Major chipmakers have been grappling with declining demand following a significant rise in interest rates over the past year. Furthermore, doubts have been raised about the long-term impact of the development of generative artificial intelligence (AI) on chip demand. Softbank's Arm, which designs chips used by major semiconductor manufacturers, also reported weak quarterly results and projected disappointing revenue and profit figures for the current quarter. Apple, a major customer for Asian chip firms, has also experienced four consecutive quarters of declining sales. It remains to be seen how the chip market will navigate these challenges and whether demand will rebound in the near future.