In 2023, Huawei broke the technological blockade of the United States and successfully developed the Kirin 9000S 5G mobile phone chip. Huawei's mobile phone business is back strongly, and the Mate60 series mobile phones equipped with the Kirin 9000S chip continue to sell well.
According to the United States** report, after more than half a year of research, the United States determined that the 9000s chip was foundry by SMIC, and the specific foundry unit was SMIC's southern factory, that is, SMIC Southern.
At the same time, the ** said that the United States has officially sent letters to dozens of companies in the United States, withdrawing export licenses, prohibiting these American companies from selling related equipment, technology and products to SMIC, in an attempt to cut off SMIC's ** chain.
If the report is true, how much impact will the U.S. supply cut have on SMIC and Huawei chips?
Since the United States began to implement a technological blockade on China, China's relevant enterprises have made a lot of preparations to ensure the safety and independence of the semiconductor chain. For example, Chinese companies have recently imported a large number of lithography machines and other semiconductor equipment, and at the same time, the localization of semiconductor equipment in China is also advancing rapidly and making positive progress.
According to Yicai, in 2023, China's semiconductor manufacturing equipment imports from the Netherlands will total up to 6 billion US dollars, accounting for about 20% of ASML's annual net sales in 2023. China has seen a surge in the number and value of lithography machines imported from the Dutch ASML. China's imports of lithography equipment from the Netherlands amounted to US$1.1 billion in December 2023, up nearly 1,000% year-on-year and 44.4 month-on-month, according to summary data released by China Customs on January 222%。
At the same time, the domestic substitution of semiconductors is also accelerating, according to South Korea's "Money Today" report, due to the United States sanctions have led to Chinese semiconductor companies to focus more on domestic manufacturers, China is ready to invest huge sums of money to improve the level of localization of semiconductor equipment, and the investment focus is on breaking through cutting-edge semiconductor manufacturing equipment and key semiconductor raw materials, including the lithography machine technology of Dutch semiconductor equipment manufacturer ASML, etc., to create a semiconductor equipment production giant belonging to China.
In the first half of 2023, the gross profit margin of China's five largest semiconductor equipment companies will be between 42% and 52%, and their profitability will increase significantly, with conspicuous performance.
South Korea's "Herald Economy" said that due to the increase in China's domestic market demand and national policy support, China is making rapid breakthroughs in the field of semiconductor equipment manufacturing. This also proves that the U.S. semiconductor restriction policy against China is ineffective. In the past three years, semiconductor companies around the world have struggled due to U.S. restrictions on Chinese semiconductors, and China is strengthening its influence in the semiconductor foundry field by increasing its semiconductor self-sufficiency rate.
At present, the problem of independent and controllable 7nm chip manufacturing of Chinese enterprises has been solved, and it has been able to meet the production and manufacturing needs of Kirin 9000s chips. SMIC and other upstream and downstream enterprises in the chip industry chain can rely on existing equipment and materials to maintain the operation of existing production lines and expand production capacity, avoiding the problem of "broken chain" production. Therefore, the supply cut of the United States has a limited impact on Huawei's chips.
Since the launch of the Kirin 9000s, the U.S. has been underestimating the Kirin 9000s' capacity ramp-up capabilities. According to the sales data of the Mate60 series of mobile phones, Huawei and its partners have not only solved the production capacity problem of 9000s chips. At the same time, Huawei has also made significant breakthroughs in the field of higher-end chips, according to the Financial Times, despite the sanctions imposed by the United States, Huawei may mass produce 5nm chips this year.