- China’s semiconductor sector is experiencing strong growth despite ongoing U.S. export restrictions on key technologies.
- Major Chinese companies such as SMIC, Huawei, and Cambricon are expanding their in-house chip design and manufacturing capabilities.
- Baidu plans to take its $3 billion chip subsidiary, Kunlunxin, public in Hong Kong, reflecting rising confidence in domestic innovation.
- Chinese chip designers are rapidly gaining ground, with new products rivaling top Western offerings.
China has accelerated efforts to build a self-sufficient semiconductor industry in response to heightened U.S. restrictions on advanced technology. Over the past year, companies like SMIC, Huawei, and Cambricon have achieved significant growth by investing heavily in chip design and manufacturing. The country’s ambition for technological independence is also driving strong performance in the domestic market, as evidenced by increased demand and rising stock prices for leading chip makers.
Baidu is preparing to list its chip unit, Kunlunxin, which is valued at $3 billion, on the Hong Kong Stock Exchange. The company expects to file its initial public offering documents in the first quarter of next year. Kunlunxin originated as an internal project focusing on intelligent chips, launching its first commercial product in 2017 and establishing itself as an independent entity in 2021. Currently, Baidu maintains a 60% ownership stake in the unit.
Recent advancements in Chinese chip technology are closing the gap with Western products. DeepSeek, for example, developed an AI model that achieved benchmark performance at a fraction of the development cost seen in Western markets. Meanwhile, Alibaba and Baidu continue to expand their AI product portfolios.
U.S. sanctions have targeted Chinese technology companies by halting exports of advanced NVIDIA chips and restricting sales of key manufacturing equipment. According to information reported through a recent statement, Cambricon Technologies has pledged to triple its AI chip output next year, with its share price rising by about 175% since July. Huawei launched its Ascend 910C chip, with performance reportedly matching Nvidia’s A100, and plans to double its advanced chip output in the coming year.
Investor confidence in Chinese semiconductor firms is reflected in strong IPO debuts. Moore Threads surged over 400% on its first day of trading, while companies like MetaX Integrated Circuits and Beijing Onmicro Electronics have received substantial interest for their public offerings.
Overall, China’s semiconductor ecosystem—including foundries like Hua Hong, designers such as HiSilicon and UNISOC, memory manufacturers like YMTC and CXMT, and equipment suppliers such as NAURA Technology Group and AMEC—continues to advance, supported by both government initiatives and escalating market demands for Artificial Intelligence.
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