ComputInsights #26 – Weekly Computing Market Insights

Market Growth

Chinese Chip Stocks Soar as DeepSeek Backs Domestic AI Hardware

Chinese semiconductor shares surged after AI start-up DeepSeek adapted its V3 model for local chips, signaling rising demand for homegrown alternatives to Nvidia. Cambricon’s stock hit a record high with a 20% jump, while SMIC and Hua Hong also rallied, reinforcing investor confidence in China’s push for AI chip self-reliance.

New ASIC Entrants Struggle to Break Into Cloud AI Market

Despite rising demand for AI-focused ASICs, new chipmakers face long development cycles and tough competition from entrenched players like Broadcom, Marvell, Alchip, and MediaTek. Analysts expect most recent entrants won’t see meaningful revenue until 2028, as cloud customers largely favour established suppliers, though MediaTek’s recent win against Broadcom shows latecomers can still carve out opportunities.

Company-Specific News

Nvidia Earnings to Spotlight AI Demand, Blackwell Ramp-Up, and China Sales Outlook

Nvidia’s upcoming Q2 FY2026 earnings (Aug 27) will focus on surging AI demand, the pace of Blackwell chip capacity expansion, and its reentry into China following lifted export bans. Despite an estimated US$8B hit from earlier restrictions, strong orders from global cloud providers and sovereign AI clients, plus expected margin recovery to ~72%, position Nvidia to maintain its dominant 85% market share.

Samsung and SK Hynix Scale Back NAND Spending as SK Hynix Achieves 321-Layer Milestone

Samsung and SK Hynix are cutting back NAND flash investments amid weak demand and high costs, shifting focus to DRAM and AI-driven memory. Despite this pullback, SK Hynix unveiled a 321-layer QLC NAND chip with doubled capacity, faster speeds, and improved power efficiency, targeting SSDs and AI data centers.