Cambricon(SH:688256) First Shanghai Securities·2025-10-13 15:29Investment Rating - The report maintains a strong positive outlook on the AI application-driven demand for computing power, indicating a sustained high growth trajectory [2]. Core Insights - The report emphasizes that the domestic computing power capacity bottleneck has been broken, with expectations for a significant increase in domestic chip production by 2026. The acceleration of commercialization by overseas AI giants like OpenAI is also highlighted, maintaining high demand for computing hardware [2][3]. - The ongoing US-China tensions are not expected to alter the development trends in the AI industry, with domestic computing power making significant strides in capacity and key components [3]. Summary by Sections Domestic Computing Power Industry - The report notes a persistent tight balance in domestic computing power, with critical bottlenecks in advanced process capacity, advanced packaging, large model adaptation, and HBM supply gradually being overcome. Positive news from the industry is expected to catalyze market interest, particularly in the latter half of this year and into next year [3]. - Major Chinese internet companies like ByteDance and Alibaba are experiencing genuine demand for computing power to support their operations, particularly in recommendation and search algorithms, alongside the new demand generated by generative AI applications [3]. Investment Recommendations - Key companies in the domestic computing power hardware supply chain are recommended for attention, including Cambrian (688256), SMIC (0981.HK), and Huahong Semiconductor (1347.HK) [4]. - The report suggests focusing on leading companies in the optical module sector, such as Zhongji Xuchuang (300308) and NewEase (300502), due to the increasing demand for optical modules driven by the needs of companies like Google, Meta, and AWS [5]. AI Edge Hardware Opportunities - The report highlights the launch of AI smart glasses by Meta and the anticipated entry of OpenAI into AI hardware, with Apple also shifting focus towards smart glasses development [6][7]. - Companies involved in edge AI hardware, such as Zhaoyi Innovation (603986) and BYD Electronics (002475), are noted for their potential in the evolving market [7].