Cambricon Technology Corporation | Asia Pacific 2Q26 Preview: Delivery slippage clouds near-term upside; Keep OW

Research evidence excerpt

Cambricon Technology Corporation | Asia Pacific 2Q26 Preview: Delivery slippage clouds near-term upside; Keep OW

IdeaM

China – AI accelerators: Localization gains traction amid

robust AI infrastructure spending

China's AI compute industry can be globally competitive, given strong

system design and infrastructure

More broadly, we believe China’s AI GPU race is no longer soley a chip-specification

contest. While domestic silicon still trails the US by roughly two generations at the chip

level, the effective gap is narrowing through multi-die design, advanced packaging, rack-

scale system architecture, optical networking, and software-hardware co-optimization.

This is why we think system-level competitiveness matters more than ever. In a market

that is increasingly dominated by inference and utilization, vendors that deliver the most

attractive real-world token economics at an acceptable software migration cost are likely

to capture customer budgets, even without access to leading-edge process technology.

From an investment perspective, this leads to a simple conclusion: the sector should not

be valued as a monolithic policy theme. Instead, investors should differentiate among

vendors based on their ability to achieve shipment scale, ecosystem credibility, and pricing

discipline, and those that may struggle to convert technical potential into durable

revenues and margins. We therefore evaluate the group through a two-dimensional

framework of economics × execution, combining TCO, token cost, TPS, and performance-

per-dollar with qualitative factors such as foundry access, software ecosystem maturity,

CSP relationships, and roadmap credibility. In our view, this framework remains the most

effective way to distinguish likely long-term winners from those that may struggle to