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Год выпуска: September 2026
Автор: Bloomberg Businessweek
Жанр: Экономика/Финансы
Издательство: Bloomberg L.P.
Формат: PDF (журнал на английском языке)
Качество: OCR
Количество страниц: 96
China’s chip industry is having a breakout moment
In the spring of 1979, shortly after the US established diplomatic relations with the People’s Republic of China, an official American trade delegation landed in Shanghai. China had been attempting to build integrated circuits, the basic units of computers, an endeavor made more difficult by Cold War-era export bans. Its policymakers were eager for input. At a state-run factory, US executives watched as workers, mainly young women, maneuvered the tiny silicon wires into place with the help of tweezers and microscopes, then bonded them by hand. After the tour, the Chinese officials pumped the visitors for suggestions on improving their outdated processes.
In the decades that followed, China watched as Japan, South Korea and Taiwan hurtled to the front lines of the semiconductor industry. Those smaller neighbors had started chipmaking about the same time, but while they attained explosive success, China continued to lag behind. In 2015, the year the Chinese government published its ambitious Made in China 2025 blueprint for mastery of leading-edge industries, the nation relied on foreign-made semiconductors to cover about 85% of its needs, spending more to import chips than petroleum.
The deep technological deficit, resulting from the chaotic Mao Zedong years and Cold War isolation, seemed too large to overcome. Throwing money at the problem wasn’t enough. Made in China 2025 committed roughly $150 billion in government funds toward fostering a domestic chip industry, with local municipalities kicking in some of their own money. Five years in, the outlook was grim, with a number of the projects going nowhere, graft investigations underway and one of the flagship companies, Tsinghua Unigroup Co., collapsing into bankruptcy.
Yet in the past couple of years, China has surprised the skeptics. Huawei Technologies Co.’s artificial intelligence chips are now advanced enough to train sophisticated large language models, operate self-driving cars and direct the movements of humanoid robots. Chinese companies are developing methods to build some chipmaking tools domestically and to goose the performance of older ones purchased abroad, spurred in no small part by US efforts to block sales of the newest foreign gear. And in July memory-chip maker ChangXin Memory Technologies Inc., or CXMT, soared past hulking oil producers and state-run banks to grab the title of most valuable publicly listed company in China after its shares surged 466% following an initial public offering. It was the third-largest IPO in the world this year, behind those of SpaceX and SK Hynix Inc.
These advances reflect how the necessary ingredients are coming together to deliver a viable homegrown semiconductor industry. Historically, chipmakers that have attained breakout success benefited from the confluence of two factors: an effective national industrial policy campaign and at least one powerful, committed customer that helped push them to achieve innovative breakthroughs.
Take Texas Instruments Inc., the industry’s first dominant chipmaker, which enjoyed a golden era through the 1960s and ’70s. Its rise coincided with the US-Soviet space race, with hefty federal contracts and grants securing its finances and funding its ambitious research and development program. Also crucial for TI was its role as a key supplier to International Business Machines Corp.’s early mainframe computers. IBM committed to massive orders before it was even clear if TI could actually deliver, and the two companies’ engineers worked together for months to overcome the technical obstacles of fabricating the transistors.
Next was Intel Corp. When IBM began a stealth project to build its first personal computer in 1980, it chose the Californian company over TI as its supplier. This head start into the PC era helped secure Intel’s status as the world’s leading chipmaker for the next several decades. In the second half of the ’80s, Intel also became one of the major beneficiaries of a federal subsidy program to help American chipmakers survive the brutal competition against new, low-cost Japanese rivals.
More recently, Intel has seen its star eclipsed by Taiwan Semiconductor Manufacturing Co., which was built with the help of Taiwan’s government and its decades of focused and determined industrial policy. After forging close symbiotic relationships with Apple Inc., Nvidia Corp. and other companies, and helping them develop Historically, chipmakers that have attained breakout success benefited from the confluence of two factors: an effective national industrial policy campaign and at least one powerful, committed customer generations of new products, TSMC has gained a near-monopoly on global advanced-chip manufacturing.
Both of these factors — focused governmental support and collaborations with innovative customers—are now buoying China’s chipmakers. In response to US bans on certain high-tech exports, Beijing has been refining its goals for semiconductor development, with the priority today to surmount several specific technological bottlenecks that could hinder the nation’s AI aspirations.
At the same time, Chinese tech giants Huawei and Tencent Holdings Ltd. have reached a level of scale and technological sophistication at which they can provide meaningful support as anchor customers and R&D partners to help local chipmakers overcome technical obstacles. These Chinese companies had previously preferred to work with leading international chipmakers to develop their most advanced products, but in the new era of US-enforced isolation, they no longer have that option.
For a company such as CXMT, the aligning of these stars offers a once-in-a-lifetime opportunity to go big. CXMT founder Zhu Yiming, a graduate of Beijing’s elite Tsinghua University who spent the early part of his career in Silicon Valley, had a very different experience with his first chip startup. When he started GigaDevice Semiconductor Inc., in 2005, Zhu struggled to cobble together $1 million from investors, repeatedly calling to implore fellow Tsinghua alumni to pitch in, according to a profile in a university alumni magazine. Its meager resources moved GigaDevice to limit its ambitions to designing specialized flash-memory products, with outsourced production. Building its own fab wasn’t in the budget.
By the time CXMT was founded, in 2016, the floodgates had opened. From the outset, Zhu’s second startup had billions of dollars in governmental funding, plus a mandate to build its own advanced factories and go head-to-head with the global leaders in memory chips: Samsung, SK Hynix and Micron. The company lost money for a decade, turning profitable and recouping its accumulated losses only this year, as the global No. 4 in its field. John VerWey, a nonresident fellow at Georgetown University’s Center for Security and Emerging Technology, says that, in prioritizing memory chips, which are easier to produce for newcomers, China was emulating the path Japan successfully took 30 years earlier to secure a foothold in the semiconductor industry.
CXMT is now racing to develop “high-bandwidth memory,” a type of memory chip that’s a crucial part of Nvidia’s AI systems but that China isn’t yet able to produce commercially. The company’s customers — which include Alibaba, ByteDance, Lenovo, Tencent and Xiaomi, according to its prospectus — have a vested interest in helping domestic suppliers achieve this capability.
Neil Shah, co-founder of tech research firm Counterpoint Research in Hong Kong, notes that though there’s still a “massive technical generation gap” between CXMT and industry leaders, the company is aggressively narrowing the distance with the help of the domestic ecosystem. “While sanctions initially threatened to stifle growth, they ultimately pushed the company to drive micro-innovations for self-sufficiency,”
he says. CXMT’s R&D push is also benefiting from fortuitous timing: The AI boom has created a global memory-chip shortage that’s filling the company’s coffers and guaranteeing demand for some time to come.
Of course, there are still many ways these projects could go awry. Domestic alliances could break down or become mired in infighting. Reuters recently reported that CXMT had abruptly ordered engineers from a Huawei-affiliated vendor to cease work in its R&D facility, amid unhappiness from Huawei over the chipmaker’s hiking its prices.
Meanwhile the US government is continuing its efforts to thwart China’s advancement in the field, with American officials warning that these technologies will be used not only for civilian purposes but also to upgrade China’s military. In 2018 the prospects of CXMT rival Fujian Jinhua Integrated Circuit Co.—which started out looking more promising, with more startup capital and bigger construction plans—were derailed when the US indicted it on allegations of conspiring to steal trade secrets from Micron Technology Inc. The Chinese chipmaker was acquitted of the charges in 2024 but has yet to regain its footing. China’s periodic corruption purges add another element of uncertainty. A former chairman of state-owned Tsinghua Unigroup received a suspended death sentence last year for embezzling state funds.
In some ways, China’s semiconductor industry is becoming more cloistered after decades of greater international partnership. Amid the tense US-China technological rivalry, important R&D projects are proceeding in secret. Outsiders hoping for a glimpse of a company’s inner workings would have to settle for the equivalent of that 1979 tour — a rare, tightly choreographed peek. But the country is far more capable of advancing technologically on its own than it’s ever been. After many years of honing its industrial policy, engaging in international exchanges and bolstering its technical competencies up and down the supply chain, China has a complete enough ecosystem that it may be able to continue innovating, even in isolation.
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