Core Viewpoint - The article discusses the recent developments in the AI chip market, particularly focusing on AMD and NVIDIA's efforts to re-enter the Chinese market and the competitive landscape they face from domestic suppliers and ASIC chip manufacturers [1][2]. Group 1: Market Developments - NVIDIA's announcement to resume sales of its AI chip H20 in China and the introduction of a new GPU for the Chinese market has positively impacted its stock price, which rose by 4.04% [1]. - AMD's MI308 product is under review for export to China, with potential losses of $800 million due to previous export restrictions [2]. - In 2024, sales from China accounted for over 24% of AMD's total revenue, highlighting the importance of the Chinese market for both companies [2]. Group 2: Competitive Landscape - The competition in the AI chip market is intensifying, with domestic Chinese suppliers increasing their market share. IDC data indicates that domestic AI chip market share rose to over 40% in the first half of the year, while NVIDIA's share was 65.2% last year [2][3]. - TrendForce predicts that the market share of foreign AI server chips will decrease from 63% last year to 41.5% by 2025, indicating a shift towards domestic suppliers [3]. - Domestic cloud providers are currently relying on NVIDIA chips but are also exploring self-developed ASIC chips as alternatives [3]. Group 3: Strategic Initiatives - NVIDIA is actively promoting the construction of "AI factories" globally, targeting industrial enterprises to expand its market presence [4]. - AMD is working to integrate its chips into data centers of major AI firms like OpenAI and Meta, while also collaborating with governments and research institutions to build high-performance computing and AI infrastructure [4].

Summary of Conference Call Records Industry Overview - The conference call discusses the optical module and related industries, particularly focusing on the demand for optical modules, PCBs, and other network-side products driven by significant growth in TOKEN users and Annual Recurring Revenue (ARR) [1][2][4]. Key Insights and Arguments - **Growth in AI Monetization**: From April to June, TOKEN usage increased four to five times compared to the beginning of the year, indicating a substantial rise in inference computing demand, which benefits the related supply chain [1][5]. - **Impact of Tariffs**: Current optical module products are not affected by U.S. tariffs, but potential 232 industry taxes could be a concern. A 25% tax increase would have limited impact on customers due to existing tariffs [4][12]. - **Market Performance**: North American cloud service providers reported better-than-expected revenue, and major model companies are seeing significant growth in TOKEN users and ARR, which is driving demand for optical modules and PCBs [2][5]. - **Future Demand Projections**: By 2025, demand for computing power will increasingly be driven by inference rather than training, with ASICs expected to account for a larger share of the market, significantly increasing the value of optical modules and PCBs compared to GPUs [1][6][8]. - **AI Revenue Growth**: AI-related revenues are projected to reach hundreds of billions to a trillion dollars by the end of the year, with companies like OpenAI and Anthropic showing rapid ARR growth [1][6][7]. Additional Important Points - **Market Valuation**: Current market valuations for leading companies are relatively low, not fully reflecting the growth potential of optical modules and PCBs. A PE ratio of at least 20 is suggested for these sectors [3][12][15]. - **Technological Developments**: The introduction of new technologies, such as the 1.6T optical module, is expected to accelerate growth in the industry, with significant releases anticipated in the coming quarters [5][14]. - **Cost Efficiency**: ASICs have a lower cost per Flops compared to GPUs, with a cost efficiency ratio of 2-3 times better, leading to a wide range of cost fluctuations [9][10]. - **Long-term Growth Predictions**: By 2026, the growth rate for optical modules and PCBs is expected to reach 20-30%, driven by the increasing share of ASICs in the market [10][11]. Conclusion - The optical module and PCB industries are poised for significant growth driven by advancements in AI, increased demand for inference computing, and favorable market conditions. The current market undervaluation presents potential investment opportunities, with a strong outlook for the coming years.

Group 1 - The article highlights the sectors that will benefit from the "anti-involution" policy [1] - The successful delivery of the first NVIDIA GB300 NVL72 is expected to lead to a peak season for the supply chain, with analysts optimistic about the growth in Q2 and Q3 due to the rapid ramp-up of NVIDIA Blackwell and the strong development of ASICs [1] - A total of 388 institutional research reports were published today, with SF Express receiving an upgraded rating and 15 companies getting initial coverage, including four stocks like Ruijie Networks receiving in-depth coverage from New Fortune analysts [1] Group 2 - In the individual stock institutional attention ranking, Xinhecheng made its debut, with the top five being Xiaogoods City, Xinhecheng, Taotao Automotive, Kidswant, and Zijin Mining [1]

Core Viewpoint - The PCB concept stocks are experiencing significant activity, with companies like Yihau New Materials, Huadian Co., and Jingwang Electronics reaching new highs, indicating a bullish trend in the market [1] Group 1: Market Dynamics - The M8 PCB market space for AI servers and switches is projected to be between 50-60 billion by 2026, according to Tianfeng Securities [1] - Major global manufacturers are intensifying their infrastructure development to meet the surging demand for inference computing power, which is driving the growth of the PCB industry [1] Group 2: Company Performance - Yihau New Materials (301176), Huadian Co. (002463), and Jingwang Electronics (603228) have all achieved new record highs in stock performance [1] - Jin'an Guoji (002636) has seen a consecutive two-day stock increase, while Aoshikang (002913) and Zhongyi Technology (301150) are also experiencing upward trends [1] Group 3: Investment Trends - There is a notable influx of dark pool funds into these stocks, suggesting increased investor interest and confidence in the PCB sector [1]

Core Viewpoint - The article discusses the increasing competition in the AI chip market, particularly how major tech companies like Google and Meta are accelerating their development of custom chips to reduce reliance on Nvidia's GPUs, with predictions that ASIC shipments will surpass Nvidia's AI GPU shipments as early as next year [1][2]. Group 1: Market Dynamics - Nvidia has historically dominated the AI chip market, holding over 80% market share in AI servers, while ASIC-based servers currently account for only 8% to 11% [2][4]. - Google is expected to ship between 1.5 million to 2 million of its self-developed AI chips (TPUs) this year, while Amazon's AWS is projected to ship 1.4 million to 1.5 million ASICs, bringing their combined shipments close to half of Nvidia's estimated annual GPU shipments of 5 million to 6 million [2][4]. Group 2: Cost Efficiency - The key advantage driving tech giants to develop their own chips is the reduction in Total Cost of Ownership (TCO), with ASICs potentially saving 30% to 50% in TCO compared to GPUs [3]. - Google claims its TPUs can deliver three times the performance of Nvidia GPUs per unit of energy consumed, highlighting the efficiency of custom chips [3]. Group 3: Competitive Landscape - Meta is focusing on launching its new high-performance ASIC chip "MTIA T-V1" in Q4 of this year, aiming to outperform Nvidia's next-generation AI GPU "Rubin" [5]. - Despite ambitious plans, Meta faces production challenges due to limited advanced packaging capacity from TSMC, which can only provide 300,000 to 400,000 units, creating a bottleneck [5]. Group 4: Nvidia's Response - In response to the competitive threat, Nvidia has opened its proprietary "NVIDIA NVLink" communication protocol to facilitate integration with other companies' CPUs or ASICs, aiming to retain its major clients [6]. - Nvidia's established software ecosystem, CUDA, remains a significant barrier for competitors, as it allows AI developers to efficiently build and deploy applications, maintaining Nvidia's competitive edge [6].

Core Viewpoint - The AI computing sector is experiencing a significant rally, with key stocks continuing to rise despite a generally volatile market environment, particularly in the PCB sector which has seen a surge in stock prices [1][4]. Industry Changes - Marvell's recent technology seminar projected that the data center market will reach $94 billion by 2028, an increase of 26% from previous estimates. The main growth drivers are AI custom computing and high-performance interconnects, with compound annual growth rates of 53% and 35% respectively [2]. - The market's expectations for ASICs have risen significantly, which will further bolster these projections. For the domestic supply chain, the focus is on PCB, CCL, and optical modules, with ASICs expected to increase the demand for these components, particularly PCB [3]. Market Dynamics - In the current market environment, many investors are shifting their focus towards AI computing stocks, which have solid performance fundamentals, as they grow weary of the ongoing rotation in other sectors [3]. - The recent industry changes have led to an increase in future performance expectations, contributing to the strong market performance observed [4].

Core Insights - The article discusses Meta's ambitious plans to challenge NVIDIA's dominance in the AI server market with its MTIA series of products, aiming for significant production volumes and advanced technology [3][5]. Group 1: Meta's MTIA Series - Meta is developing the MTIA T-V1, T-V1.5, and T-V2 models, with T-V1 and T-V1.5 expected to have a combined shipment target of 1-1.5 million units by the end of 2026, with T-V1.5 making up a larger share [5][4]. - The MTIA T-V1.5 will feature a doubled intermediary layer size and a PCB with up to 40 layers, while T-V2 is expected to utilize larger CoWoS packaging and require liquid cooling systems with power systems exceeding 170KW [4][5]. Group 2: Market Dynamics - In 2026, the shipment volume of AI ASICs is projected to surpass that of GPGPUs, with NVIDIA currently holding over 80% of the AI server market value share, while ASIC AI servers account for approximately 8-11% [6][7]. - By 2025, the combined shipment of Google TPU and AWS Trainium 2 is expected to reach 40-60% of NVIDIA's GPU shipments, indicating a shift in market dynamics [7]. Group 3: Cost and Technical Considerations - The article highlights a divergence in views regarding the necessity and cost of ASICs, with some large cloud service providers (CSPs) advocating for ASICs to bridge technology gaps despite higher BOM costs, while NVIDIA's CEO suggests that most ASIC projects may be canceled due to economic viability concerns [9][10]. - The high costs associated with ASICs stem from the need for larger CoWoS packaging and high-spec PCBs, which are essential for performance compensation and thermal management [11][12]. Group 4: PCB Market Potential - The article notes that the market for ASIC and GPU PCBs is expected to double in value, with a projected growth rate of 65% next year, indicating a significant opportunity for PCB suppliers [16]. - Companies like Huada Empyrean (WUS) are highlighted as potential beneficiaries of this growth, providing advanced PCBs for Meta's MTIA [17][19].

Core Viewpoint - NVIDIA's CEO Jensen Huang asserts that NVIDIA's growth will continue to outpace that of Application-Specific Integrated Circuits (ASICs), citing a high failure rate among ASIC projects and emphasizing NVIDIA's rapid technological advancements and cost optimization [1][2][3]. Group 1: NVIDIA's Market Position - NVIDIA is not concerned about being marginalized in the AI market, recognizing its essential role in the computing field [2]. - Huang believes that most ASIC projects will be canceled if they do not outperform existing chips, indicating a competitive landscape where NVIDIA's technology remains superior [2][3]. Group 2: NVLink Technology - NVIDIA has introduced NVLink Fusion, a new technology aimed at integrating third-party CPUs and accelerators with NVIDIA's ecosystem, enhancing flexibility for system suppliers [5][7]. - NVLink has evolved since its introduction in 2016, significantly increasing bandwidth and enabling faster interconnects between GPUs [6][9]. Group 3: Future Developments - The NVLink Fusion initiative allows for semi-custom designs, enabling third-party chips to connect with NVIDIA GPUs, although it remains proprietary [10][14]. - Companies like Fujitsu and Qualcomm are developing CPUs that will support NVLink Fusion, aiming to improve efficiency and performance [16]. Group 4: Industry Collaboration - Cadence and Synopsys are participating as technical partners in the NVLink Fusion program, providing IP blocks and design services to companies looking to build compatible hardware [17].

Investment Rating - The report gives a "Buy" rating for the company, marking the first coverage of the stock [4][5]. Core Views - The company is positioned as a leading provider of one-stop customized chip design and semiconductor IP licensing services, focusing on R&D to drive future growth [14][17]. - The demand for self-developed ASICs from cloud vendors is surging, presenting historical opportunities for the chip design service industry [2][38]. - There is a pressing need for domestic semiconductor IP, with the company ranked first in China and eighth globally in terms of sales revenue [3][4]. Summary by Sections One-Stop Customized Chip Design & IP - The company offers comprehensive chip customization services and semiconductor IP licensing, with a strong emphasis on R&D and talent development [14][17]. - As of Q1 2025, the company has a record high order backlog of 24.56 billion yuan, indicating robust future revenue potential [1][11]. ASIC Demand Surge - The chip design service industry is experiencing a significant demand increase for self-developed ASICs, particularly from major cloud service providers [2][38]. - The company has strong supply chain capabilities, enabling it to meet the self-development needs of large enterprises [2][38]. Semiconductor IP Localization - The company is the leading provider of semiconductor IP in China, with a wide range of applications for its NPU and GPU IP products [3][4]. - The localization of semiconductor IP is critical, and the company is well-positioned to benefit from the trend towards domestic alternatives [3][4]. Profit Forecast and Investment Recommendations - Revenue projections for the company are 31.8 billion yuan in 2025, 40.6 billion yuan in 2026, and 58.8 billion yuan in 2027, with expected growth rates of 36.9%, 27.6%, and 45.0% respectively [4][9]. - The company is expected to turn profitable by 2025, with a projected net profit of 0.1 billion yuan, growing significantly in subsequent years [4][9].

Group 1: Low-altitude Economy - The central government has issued opinions to support the development of emerging industries in Shenzhen, including reforms in low-altitude flight management and regulations [1] - By May 2025, 30 provinces in China will include low-altitude economic development in their government work reports, with various local plans already in place [1] - The Civil Aviation Administration of China predicts that the low-altitude economy market will reach 1.5 trillion yuan by 2025 and 3.5 trillion yuan by 2035, driven by policies, infrastructure, and market forces [1] Group 2: Intelligent Robotic Hands - Researchers from Beijing General Artificial Intelligence Research Institute and Peking University have developed an intelligent robotic hand that achieves human-level adaptive grasping [2] - The robotic hand integrates high-resolution tactile sensing over 70% of its surface, allowing it to adjust its actions in real-time based on tactile feedback [2] - The market for robotic hands is expected to reach 45 billion yuan by 2030, with companies that can design and produce these hands likely to gain significant market power [2] Group 3: Stem Cell Therapy - China's first stem cell prescription drug, Aimi Maito injection, has been commercially applied in clinical settings, marking a significant milestone in stem cell therapy [3] - Stem cells are recognized for their unique regenerative capabilities, and the government is encouraging the development of cell therapy and gene therapy industries [3] - Stem cell technology is considered a third medical revolution, with ongoing advancements expected to benefit patients with difficult-to-treat diseases [3] Group 4: Media and Audio Content - Tencent Music announced plans to acquire Himalaya Holdings for a total price of 1.26 billion USD, enhancing its audio content ecosystem [4] - The acquisition aims to strengthen Tencent Music's dual-core strategy of "music + audio," integrating various audio content types [4] - The deal is expected to shift the industry towards ecological competition and accelerate the commercialization of long audio formats [4] Group 5: AI Chip Design - The launch of the first fully automated design system for AI-based processor chips, named "Qimeng," signifies a breakthrough in chip design capabilities [5] - The system can automate the entire design process from hardware to software, achieving levels comparable to human experts [5] - Domestic ASIC manufacturers are expected to benefit from the tightening of AI chip export controls, as they may capture more market share [5] Group 6: Innovative Drugs - The innovative drug Tofersen injection, the first precision treatment for ALS in China, has been officially launched [6] - This drug targets adult patients with SOD1 gene mutations, providing a new hope for treating this rare and fatal neurological disease [6] - The increasing presence of domestic innovative drugs at international conferences indicates a growing focus on innovation within the industry [6] Group 7: Genetically Modified Organisms (GMOs) - The GMO sector has seen significant performance improvements due to heightened government focus on seed safety and agricultural innovation [7] - China is accelerating the commercialization of GMO breeding, particularly for varieties with independent intellectual property rights [7] - The emphasis on food security and technological innovation positions the seed and grain planting sectors for potential market growth [7]