China's AI Chips and Export Controls: Ascend, SMIC — 2026-09-10
Huawei is accelerating its domestic semiconductor supply chain initiative, aiming to double AI chip output and bypass US export controls through novel architectures and local component sourcing. Meanwhile, Chinese GPU maker Moore Threads experienced a significant stock drop following the expiry of lock-up periods, highlighting a divergence between market valuations and industrial realities.
China's AI Chips and Export Controls: Ascend, SMIC — 2026-09-10
Top developments
Huawei Spearheads Domestic Semiconductor Supply Chain
Huawei is playing a central "project management" role in China's initiative to produce advanced semiconductors domestically, aiming to build components for Deep Ultraviolet (DUV) lithography machines to avoid US export restrictions. The company plans to double its AI chip output to 600,000 Ascend 910C units in 2026 by utilizing a new "LogicFolding" architecture. This strategy is designed to mitigate supply chain vulnerabilities and accelerate China's path toward chip self-sufficiency.
Moore Threads Stock Plunges on Lock-Up Expiry
On September 7, shares of Chinese GPU manufacturer Moore Threads fell sharply, hitting a limit-down drop on its first trading day after the expiry of initial public offering (IPO) lock-up periods. The decline reflects growing investor concerns about the divergence between high market valuations for Chinese chipmakers and their actual commercial profitability. This event underscores the capital market volatility facing the sector as it transitions from government-subsidized development to competitive commercial sales.
Chinese Chipmakers Secure Long-Term Sanctions Buffer
Chinese chipmakers are reportedly securing a three-year buffer against potential future sanctions by aggressively stockpiling critical equipment and materials. At the center of this effort is a scanner built by Shanghai startup Yuliangsheng, which is being integrated into domestic production lines to reduce reliance on foreign tools. This move signals Beijing's determination to insulate its semiconductor industry from further US export control tightening.
Local view
Local financial media, including Sina Finance and Huxiu, are focusing heavily on the capital market implications of recent chipmaker IPOs. The sharp drop in Moore Threads' stock price on September 7 was widely reported as a "collective chill" for the sector, with analysts questioning whether current valuations are sustainable given the intense competition and technological hurdles. Reports from CCTV earlier in August noted that while orders for domestic chips are booked out for three years, the industry is still in a transition phase from "usable" to "easy-to-use" products.
Context & numbers
- Huawei Output Target: Huawei aims to produce 600,000 Ascend 910C AI chips in 2026, doubling previous capacity estimates.
- Domestic Market Share: Analysts suggest that homegrown AI accelerators from Huawei and Cambricon are on track to supply nearly 90% of China's domestic AI chip market, significantly reducing reliance on Nvidia and AMD.
- Cambricon Performance: Cambricon reported H1 2026 revenue of RMB 5.996 billion and net profit of RMB 2.311 billion, demonstrating significant growth in the domestic sector.
On the radar
- US Cloud Access Loophole: US lawmakers are weighing options to close a "crucial loophole" that allows Chinese AI firms to access advanced Nvidia computing power via overseas cloud services, which could impact future export control enforcement.
- Nvidia China-Specific Chip Rumors: Despite earlier reports, Nvidia has denied rumors about launching a specific China-version AI chip (LPU) by the end of 2026, indicating continued uncertainty in the US-China chip trade dynamics.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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