A conference scheduled next month by Huawei Technologies’ secretive chip design unit HiSilicon has fanned speculation that a sanctions-busting breakthrough may be announced, triggering a surge in some China-listed tech stocks.
While Huawei has disclosed few details about HiSilicon’s Connect Conference, scheduled for September 9-10 in Shenzhen, the event has triggered talk of breakthroughs and the official formation of a Huawei-centred ecosystem from chip design to operating systems.
Shenzhen Huaqiang, a distributor of HiSilicon’s products, issued a statement on Monday warning investors that there were still “uncertainties” around HiSilicon’s new product launch at the conference, after its stock price surged by the daily limit of 10 per cent on both Thursday and Friday.
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In the statement, the company said it would redouble its efforts to promote and expand the market for new HiSilicon products. The stock again reached the daily 10 per cent limit on both Monday and Tuesday.
A Kirin 9000s chip taken from a Huawei Mate 60 Pro smartphone, arranged in Ottawa, Ontario, Canada, Sept. 3, 2023. Photo: Bloomberg alt=A Kirin 9000s chip taken from a Huawei Mate 60 Pro smartphone, arranged in Ottawa, Ontario, Canada, Sept. 3, 2023. Photo: Bloomberg>
Huizhong Instrumentation, a maker of ultrasonic flow measuring devices that saw its stock soar 40 per cent over two trading days last week, also issued a statement on Monday, saying the company uses HiSilicon chips in some products but does not purchase directly from Huawei. Its shares fell as much as 19 per cent following the statement.
Huawei did not immediately reply to a request for comment on Tuesday.
HiSilicon’s event is expected to offer a glimpse into Huawei’s ambitions and progress regarding its chip capabilities, which it has kept under wraps since HiSilicon was added to the US government’s trade blacklist in 2019. Washington tightened trade restrictions in August 2020 to prevent HiSilicon-designed chips from being manufactured by major chip foundries such as Taiwan Semiconductor Manufacturing Company (TSMC).
Prior to the sanctions, HiSilicon was on path to develop its own processor chips for smartphones and networking products, which could have rivalled those offered by US chip giants Intel and Qualcomm.
HiSilicon accounted for a 16 per cent share of the global application processor market in the second quarter of 2020, according to Counterpoint data, on the back of its shipments of the advanced Kirin chips used in Huawei’s smartphones.
That share dropped to zero in 2022, Counterpoint data showed, and it remained an irrelevant player in the market until Huawei launched its 5G-capable Mate 60 series, powered by the HiSilicon Kirin 9000s, last August.
A large screen advertises the new Mate 60 smartphone on a Huawei store in Shanghai, August 31, 2023. Photo: EPA-EFE alt=A large screen advertises the new Mate 60 smartphone on a Huawei store in Shanghai, August 31, 2023. Photo: EPA-EFE>
Huawei has remained tight-lipped over its 5G chip, but the company’s distributors last month started giving customers details of the processor used inside Mate 60 series. Since the launch of those smartphones last year, Huawei’s progress in semiconductors has been closely watched. The company’s more recent Pura 70 series smartphones run on chips made using the same 7-nanometre process as the Mate 60 chip, according to teardown reports.
Despite its ambitions, Huawei has rarely spoken publicly about its efforts to free itself from the shackles of US sanctions, which were imposed by Washington over national security concerns that China’s advancement in semiconductors and artificial intelligence would be used to modernise the country’s military.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.
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