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NVIDIA released its earnings after the US market close today, with its stock rising 2.2% overnight to end a seven-session losing streak. OpenAI stated that its self-developed Jalapeno chip outperforms NVIDIA’s GB300 in testing, intensifying competition from large model developers building in-house chips.
Morgan Stanley: The five major cloud providers, together with NVIDIA and Broadcom, have pledged more than USD 3.1 trillion in financial support for AI infrastructure. TrendForce forecasts that DRAM and NAND contract prices will account for 68% of major CSPs’ capital expenditure by 2027, extending the supercycle for memory chips.
Jwei In-depth Analysis: A critical gap remains for mass production of glass substrates. Samsung Electro-Mechanics has postponed mass production of its GlaSSEM for the third time to post-2028. TSMC’s CoPoS is scheduled for pilot production in 2027 and volume manufacturing in 2028, while BOE has submitted samples of its 20-layer glass substrate to leading computing power enterprises.
SMIC received buy ratings from First Shanghai (target price: HKD 120) and Huaxing Securities (target price: HKD 142). Naura posted H1 revenue of RMB 20.161 billion (+24.9%) and net profit of RMB 3.37 billion (+5.05%).
In-depth Analysis
Optical Communication / Optical Chips: US optical communication stocks rallied overnight, with Lumentum rising over 6%, AOI up more than 5% and Coherent gaining over 4%. On August 25, A-share computing hardware saw divergent performance; leading optical module makers Innolight and Eoptolink closed nearly 3% lower, while capital rotated into niche segments such as liquid cooling (Envicool hit the daily limit) and optical fiber (Tefa Information sealed the daily cap, Hengtong Optic-Electric +7%). The electronics sector topped institutional research surveys in August (72 institutions), with Advanced Micro-Fabrication Equipment and Focuslight drawing attention from over 300 institutions each. On the primary market, Muchuang secured several hundred million yuan in Series B financing to develop 400G/800G smart NIC chips and GPU Scale-Up interconnect chips, filling gaps in domestic intelligent computing interconnection.
Advanced Packaging: An in-depth report by Jwei Media notes that mass production of glass substrates remains distant. GlaSSEM, a joint venture between Samsung Electro-Mechanics and Dongwoo Fine-Chem, has postponed volume manufacturing for the third time to after 2028 due to failed customer reliability verification. TSMC’s CoPoS will adopt 310×310mm substrates, with pilot production slated for 2027 and volume output in H2 2028. Intel’s New Mexico plant is expected to become the world’s first mass-production site by 2030. BOE achieved full automatic line operation in H1 (monthly capacity of 1,000 panels) and has submitted samples of 20-layer large-size glass carriers for computing chips to leading computing power vendors. No major new updates on ABF/IC substrates for the day. The thesis of domestic CBF/NBF substitution persists amid Ajinomoto’s supply cuts to mainland customers (previously reported).
SiC / Power Semiconductors: Jingsheng delivered its self-developed complete set of large-size CVD SiC coating equipment, supporting domestic substitution of semiconductor thermal field components. Nexchip’s PMIC revenue proportion rose to 12.82%; it now fabricates AI server power supply chips for top domestic DrMOS suppliers, with 90nm BCD technology under ongoing verification. No other major updates for the day.
Storage & Compute Chips: TrendForce projects continuous surges in memory contract prices, with DRAM and NAND accounting for 68% of major CSPs’ capital expenditure by 2027. Longsys adjusted its raised-investment projects to RMB 3.668 billion, allocating RMB 880 million to high-end AI memory, RMB 1.22 billion to storage controller chips and RMB 500 million to high-end packaging and testing. Biwin swung to a net profit of RMB 7.166 billion in H1, with AI edge storage revenue jumping 4.34x. Apple unveiled the M5 Max and M5 Ultra chips.
Equipment & Materials: Naura recorded H1 revenue of RMB 20.161 billion (+24.9%) and net profit of RMB 3.37 billion (+5.05%), with Q2 profit rising 6% quarter-on-quarter. Shenghua Electronics posted H1 net profit of RMB 2.923 billion (+73.72%), reflecting sustained prosperity in AI PCBs.
Wafer Fabrication: SMIC received buy ratings from First Shanghai and Huaxing Securities (target prices of HKD 120 and HKD 142 respectively). Institutions are optimistic about price hikes in mature nodes and yield improvements in advanced processes. Nexchip generated H1 net operating cash flow of RMB 2.798 billion (+64.1%), with CIS revenue accounting for 25.34%. Its 28nm logic platform is undergoing customer tape-out verification. The RMB 35.5 billion Phase IV project is scheduled for production in Q4 2026. The firm ranks 8th globally and 3rd among mainland foundries.
Policy & Macro Environment: August institutional surveys show the electronics sector garnered the most interest (72 institutions), centered on the AI industrial chain (PCBs, optical modules, semiconductors, data centers). Canada announced retaliatory tariffs on USD 20 billion worth of US goods effective September 8, with trade friction risks requiring continued monitoring. No new major export control or industrial policy updates for the day.
Daily Investment Tips
1. NVIDIA’s earnings release (after market hours tonight) represents the biggest variable. Following a seven-session losing streak, the market has set a high bar for performance delivery. Should its guidance on capital expenditure and gross margin (around 75%) fall short of expectations, it may trigger volatility at high valuations across the AI computing chain including optical modules, memory and PCBs; better-than-expected results, by contrast, could fuel a sector rebound. Attention should be paid to disclosures regarding memory cost pass-through and the shipment timeline of Vera Rubin.
2. The glass substrate theme has entered a phase of expectation revision. The delayed mass production by Samsung Electro-Mechanics confirms that technological maturity is below optimistic forecasts. In the short term, this actually reinforces the thesis of tight ABF/IC substrate supply and domestic substitution of build-up films (such as Huazheng New Materials’ CBF). For the medium term, track the mass production schedule of TSMC’s CoPoS and BOE’s sample validation progress, and guard against excessive valuation from thematic speculation.
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