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Chinese chip firm Cambricon has seen its revenue skyrocket by 43 times, as Beijing aims to reduce reliance on foreign chips and develop domestic alternatives. In the latest fiscal year, Cambricon reported RMB2.9 billion in revenue, up significantly from last year’s figures. Its profit also grew substantially, reaching RMB1 billion compared to RMB530 million a year ago.
Cambricon plays a key role in China’s AI chip ecosystem, ranking second behind Huawei. Huawei’s Ascend AI accelerators remain the top-performing domestic AI chips. Cambricon recently released its earnings report for the first half of the year, showing a 43-fold annual increase in revenue to RMB2.88 billion, with profits doubling from the previous year’s loss.
Cambricon offers seven AI chips, including the MLU690 and MLU590. The MLU590 is reportedly built on a 7-nanometer manufacturing process, possibly produced by SMIC or TSMC.
Revenue from cloud computing accounts for 99.6% of Cambricon’s first-half earnings, indicating that the surge in revenue is driven by AI demand, supported by Beijing’s push for domestic chip reliance.
Cambricon continues to invest heavily in research and development, spending RMB456 million during the first half, accounting for 15.9% of its operating revenue. Despite a slight drop in the percentage of operating revenue, Cambricon’s absolute investment remains high.
Following this success, Cambricon plans to raise RMB3.98 billion in funding to capitalize on strong domestic demand for AI chips. The firm turned a profit in Q1 with RMB355 million in net income, a significant jump from Q1 2024’s RMB227 million.
Cambricon’s shares have gained 112% year-to-date, reflecting a 94% increase since early August. Over the past year, the stock has risen by 462%, indicating a sudden surge in domestic demand for Chinese AI chips.
