Core Insights - A significant power construction plan is underway in the U.S., with major tech companies advancing towards a scale of 10GW and millions of AI chips [1] - Capital expenditure (CapEx) is a key indicator for observing power investments, with over 80% of CapEx typically allocated to power procurement [1] - By 2026, the combined capital expenditure of the five major tech companies is projected to exceed $470 billion, indicating a conservative growth rate of at least 26% [1][2] Group 1: Capital Expenditure Trends - The total capital expenditure of the five major tech companies is expected to surpass $370 billion in 2025, reflecting a growth rate of approximately 64% compared to $220.8 billion in 2024 [2] - Microsoft anticipates a capital expenditure of $937 billion for the fiscal year 2026, following a 45.1% increase in 2025 [10] - Amazon's capital expenditure is projected to be around $1.25 billion in 2025, with significant growth expected in 2026 [10][11] Group 2: Demand and Supply Dynamics - The backlog of orders (remaining performance obligation, RPO) for the five major tech companies is growing at a rate that exceeds capital expenditure growth, indicating a supply-demand imbalance [5][16] - As of Q2 2025, the total RPO for these companies is estimated at $846 billion, with significant year-on-year growth [17] - Microsoft reported nearly $400 billion in backlog orders, with demand exceeding expectations [22] Group 3: AI Chip Demand - The projected capital expenditure will fund at least 16GW of power and over 3 million AI chips, with total new investment exceeding $160 billion [12][10] - Nvidia is a direct beneficiary of this trend, with 88% of its revenue coming from data center AI chips, primarily from these major tech companies [6][8] - The demand for AI chips is expected to continue growing, driven by the increasing need for computational power in AI applications [28] Group 4: Future Outlook - The overall power market is forming a positive cycle from upstream chip supply to downstream AI application demand [9] - Concerns about potential AI bubbles persist, but the consensus is that the current investments are necessary for future growth [24][31] - Major tech companies are prioritizing capital investments to ensure they meet the growing demand for AI capabilities, with a focus on long-term resource availability [32]

Market Performance - The market experienced a rebound on October 29, with the Shanghai Composite Index rising above 4000 points. The total trading volume in the Shanghai and Shenzhen markets reached 2.26 trillion yuan, an increase of 108.2 billion yuan compared to the previous trading day. The Shanghai Composite Index rose by 0.7%, the Shenzhen Component Index increased by 1.95%, and the ChiNext Index surged by 2.93%. The Communication ETF (515880) also saw a rise of 1.89% [1][2]. Short-term Outlook - Positive signals in China-U.S. relations have alleviated significant valuation pressures. Recent economic discussions between Chinese and U.S. officials in Kuala Lumpur focused on key trade issues, leading to a basic consensus on resolving mutual concerns [2]. - A busy week for earnings reports is expected, with major companies in sectors like optical modules, PCB, and ODM yet to release their Q3 financial results. There is a strong possibility of growth in the performance of leading companies in these sectors [2]. Company Insights - NVIDIA's CEO announced at the GTC conference that the company expects to ship 20 million units of the Blackwell-Rubin architecture between 2025 and 2026, projecting approximately $500 billion in data center revenue visibility. This suggests NVIDIA could achieve over $300 billion in revenue by 2026, significantly exceeding current market expectations [3]. - Google reported a Q3 revenue of $102.35 billion, a 16% year-over-year increase, with net profit rising by 33% to $34.98 billion. Google Cloud revenue grew by 35% to $15.16 billion, surpassing market expectations [5][12]. - Microsoft’s Q1 FY26 revenue reached $77.7 billion, a 4% year-over-year increase, with cloud revenue growing by 28% to $30.9 billion. Capital expenditures for the quarter were $34.9 billion, exceeding market expectations [12][13]. - Meta's Q3 revenue was $51.24 billion, a 26% year-over-year increase, slightly above market expectations. The company anticipates significant capital expenditure increases in 2026 [15]. Long-term Outlook - The AI infrastructure investment model is shifting from self-funded to financed investments, with an expected increase in hardware shipments. OpenAI's recent activities indicate a growing demand for computing power, which may lead to accelerated AI infrastructure development [18]. - The international macroeconomic environment is improving, suggesting further liquidity enhancements. AI is expected to remain a core driver of market growth, with opportunities in the equity market likely to persist in the medium to long term [18][19]. Product Characteristics - The Communication ETF has a core content of 21%, effectively representing the fundamentals of overseas products. As of October 28, optical modules accounted for 52% of the ETF, while servers made up 22%, totaling 81% when combined with fiber and copper connections [20][21]. - The Communication ETF's underlying index has shown a year-to-date increase of 117.17%, leading its peers in performance [22][23].

Group 1 - The core viewpoint indicates that there is a significant demand for computing power, which is currently outstripping supply, particularly following OpenAI's recent actions and the launch of ChatGPT Atlas on October 22, leading to a noticeable increase in token consumption [1] - OpenAI's recent financing efforts are expected to accelerate AI computing infrastructure, with other manufacturers likely to follow suit [1] - The computing hardware market is projected to grow rapidly, with high-end components such as 1.6T optical modules expected to see increased demand due to the anticipated release of NVIDIA's Rubin series chips and Google's TPU7 [1] Group 2 - The optical module market is expected to maintain a high level of prosperity, supported by ongoing investments in computing infrastructure both domestically and internationally [1] - As of October 24, the communication ETF (515880) ranks first in its category with a scale of 10.299 billion, where "optical modules + servers + copper connections + optical fibers" account for over 80% of the portfolio, indicating a strong fundamental outlook for computing hardware [2] - Optical modules alone represent over 50% of the ETF, suggesting potential investment opportunities in related sectors [1]

Summary of Conference Call Records Industry Overview - The conference call discusses the liquid cooling technology industry, particularly focusing on NVIDIA's advancements and the domestic market in China. The liquid cooling market is expected to grow significantly, with projections indicating a potential market size of 50 billion yuan by 2028 [2][27]. Key Points and Arguments NVIDIA's Liquid Cooling Technology - NVIDIA has faced thermal issues with the GB200 model, leading to the adoption of an all-purpose plate liquid cooling solution for the GB300, which has passed testing [1][2]. - Future Rubin series chips may utilize two-phase all-purpose plates or two-phase coupled silent liquid cooling, explicitly excluding water-based liquids [1][3]. - The single cabinet power for future models could reach 300-500 kW, necessitating more efficient cooling solutions due to increased chip thermal density [2][3]. Market Dynamics - The domestic liquid cooling market is projected to double in size to approximately 3 billion yuan in 2023, still significantly smaller than overseas markets [1][13]. - Companies like Alibaba are shifting from self-built data centers to leasing due to slow construction speeds, planning to invest 380 billion yuan over three years [2][20]. - The competition remains stable, with many companies still exploring effective air cooling solutions due to deployment speed being a critical factor [13][14]. Technical Developments - The dual-plate liquid cooling system has undergone iterations to address volatility, low toxicity, and cost control [1][4]. - The transition from copper to aluminum for liquid cooling plates is aimed at reducing costs, although complex processing may offset some savings [1][8]. - The total cost for a single cabinet using a single-plate system is approximately $100,000, with hardware accounting for 30%-40% of that cost [7][8]. Future Trends - The future of liquid cooling systems is expected to include both all-purpose and immersion cooling solutions, with potential cost increases of 1.5-1.8 times for different configurations [10][11]. - The domestic market is still in its early stages, with significant growth potential as companies adapt to new technologies and cooling methods [13][27]. - Efficient management and optimization of cooling media will be crucial for future developments, especially as the market scales [27]. Challenges and Considerations - The use of water-based media in single-plate systems has low initial construction costs but high total ownership costs over the lifecycle [2][27]. - The complexity of manufacturing two-phase cooling plates increases labor and processing costs, impacting overall pricing strategies [9][8]. - The industry faces challenges in maintaining system stability and addressing the toxicity and volatility of cooling media, particularly in single-phase systems [24][23]. Competitive Landscape - Domestic manufacturers like Huawei and Alibaba are exploring various cooling technologies, with Huawei's Ascend 910C chip showing competitive performance [16][22]. - The market is characterized by a mix of established players and emerging companies, with significant investments in research and development for liquid cooling technologies [12][15]. Additional Important Insights - The shift towards aluminum in liquid cooling systems is driven by its compatibility with refrigerants and cost-effectiveness, despite concerns over corrosion [28]. - The choice of refrigerants is critical, with 134A being a common option, but facing regulatory challenges that may necessitate the development of more environmentally friendly alternatives [30]. - The overall trend indicates a move towards more integrated and efficient cooling solutions that can handle the increasing demands of high-performance computing environments [32].