With AI accelerating and foreign chips restricted, China’s domestic silicon has had a banner year. Results from Cambricon and Moore Threads show first-half revenue more than doubling at both, nearly matching or exceeding last year’s full-year total.
After its first annual profit in 2025, Cambricon’s earnings pace has quickened: first-half net profit rose over 120 per cent. Moore Threads has sharply cut its loss and is approaching a profit inflection. Yet on the news both stocks fell, Cambricon by more than 6 per cent and Moore Threads by about 4 per cent, to market values of 706.2 billion yuan and 269.8 billion yuan, each pulled back roughly 30 per cent and 39 per cent from their peaks.
Moore Threads nears an inflection
Both set fresh records. Cambricon’s first-half revenue reached 5.996 billion yuan, up 108 per cent, close to last year’s roughly 6.5 billion yuan for the full year. Net profit attributable to shareholders was 2.311 billion yuan, up 123 per cent, already 250 million yuan above the full year. Moore Threads posted revenue of 1.736 billion yuan, up 147 per cent, past its full-year figure, while cutting its net loss to 11.56 million yuan, a 96 per cent improvement.
Cambricon’s cloud line, including the Siyuan 690 and 590 families, contributes almost all revenue, over 99.97 per cent in the first half. The company’s shift from IP licensing toward selling AI chips, then toward internet and finance clients, drove the blowout; its market value first passed 1 trillion yuan at the end of June. Moore Threads, founded in 2020, follows Nvidia’s full-function GPU path with five generations of architecture and a cloud-centric mix near 98 per cent.
Inventory surges, cash pressure builds
Chasing the compute boom, both firms went on a buying spree. Cambricon’s inventory hit 8.248 billion yuan, up nearly 67 per cent and 45 per cent of total assets. Moore Threads’ inventory leapt 166 per cent to 3.55 billion yuan, near 21 per cent of assets. The write-downs are already real: Moore Threads took 36.24 million yuan of inventory impairment, up 346 per cent, while Cambricon’s hit 397 million yuan, up 1,269 per cent.
Heavy inventory also freezes cash in the supply chain. Moore Threads’ operating cash flow swung to a 2.169 billion yuan outflow from a 1.164 billion yuan deficit a year earlier; Cambricon’s fell 66 per cent to 311 million yuan. With shares under pressure, investors are asking whether the stockpile becomes revenue or dead weight.
After raising nearly 7.6 billion yuan in its 2025 STAR Market listing, Moore Threads plans a Hong Kong float to keep funding the race. Cambricon, having crossed into profit, is pouring more than 3.2 billion yuan into a new processor microarchitecture and instruction set, and 2.7 billion yuan into system software, adapting to DeepSeek, Qwen, Hunyuan and other models.
The trillion-yuan prize
Moore Threads is building a “three factories” system, a model-training factory, a token-production factory and an agent-production factory, on its KUAE cluster, with a new architecture targeting scales beyond 100,000 cards. Frost and Sullivan projects China’s AI-chip market will reach 1.3 trillion yuan by 2029, a 54 per cent compound growth rate. For Cambricon and Moore Threads, this is only the first step toward that prize.
Editor’s note: This is an adapted translation of the original Sohu report. It has been trimmed and restructured for readability for an international business audience.