The dawn of 2025 saw the emergence of Deepseek, a significant player in the AI industry, redefining the landscape through open-source models and innovative algorithmsThe strategic objective is clear: decrease the operational costs associated with large model inferencingThis development has caught the attention of key financial institutions, with Citi Securities indicating that the reduction in inference costs for the Deepseek model could serve as a catalyst for the widespread adoption of AI applications across various sectors in ChinaEnhanced cost-performance ratios are anticipated to lead to accelerated implementation of AI technologies within a rich ecosystem and mature traffic frameworks.

In contrast to the vibrant influx of new algorithms revolutionizing industry perceptions, the foundational aspect of computational power remains steadfast and reliableIt is widely recognized as one of the trifecta supporting AI innovations, alongside algorithms and dataThe ongoing investments from leading hardware providers suggest a robust trajectory for the industry despite the introduction of the Deepseek R1 modelResearch reports, including notable analyses from Tianfeng Communications, tailoredly note that while inference models are advanced, the insatiable demand for computational power in AI training still persists, particularly in the quest for a high-level Artificial General Intelligence (AGI).

The past year illustrated a fervent interest in the computation sector on the capital marketsProminent entities within this segment have surged into the spotlight, with companies such as Cambricon Technologies achieving a remarkable stock price increase of 387%, leading A-shares for 2024. Haiguang Information also saw a significant uptick in its stock price, closing the year with a 132.83% gainThis vibrant performance signifies not just investor enthusiasm but also reinforces the importance of computing capabilities in the ongoing AI revolution.

Mutual fund strategies reflected this trend as well, with uncommon concentrations targeting computational stocks

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By the end of 2024, flagship mutual fund portfolios prominently featured newcomers such as Cambricon and SMIC, while passive index funds likewise spotlighted computational chip firms like Cambricon and Haiguang, together possessing an impressive total market capitalization of approximately 30.784 billion yuan.

The market’s lofty expectations around computational stocks will hinge on the realization of substantial applicationsWhile commercial computational markets are still on a trajectory requiring innovative advancements and growth to reach critical mass, the demand for computational power in the trustworthy creation market is expected to manifest with greater visibility and broader prospectsIn the landscape dominated by domestic computational chips, Haiguang Information's CPU and DCU products exhibit competitive differentiation against their peers, leveraging a well-rounded industry ecosystem.

Haiguang’s unique product advantages have emerged as significant considerations for stakeholders in the trustworthiness innovation marketThe continuous rise of large AI models such as GPT, Wenxin Yiyan, and Doubao has precipitated an unprecedented demand for computational resourcesThe training and operation of these sophisticated models necessitate considerable computational power, subsequently propelling a fast-paced expansion of the computational marketplace.

In parallel to this demand, governmental and industry initiatives are increasingly aligned with the pursuit of autonomous computing capabilitiesThis demand's vigorous growth reflects the heightened priorities around information security and advancements in digital technology across all sectors, including finance, telecommunications, energy, transportation, and healthcare, where there is a concerted effort to respond to the evolving digital economyIndustries are progressively integrating fully domestic solutions spanning IT infrastructure to foundational and application software tailored for security.

Addressing the persistent "choke point" issues within China’s information sector while amplifying comprehensive independent innovation capacities has catapulted the trustworthiness innovation sector into national strategic discussions, particularly in sectors like finance and governance

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The current market converse around the demand for key IT hardware, including CPUs and GPUs, clearly outlines three focal requirements: mainstream technological pathways, autonomous security controllability, and comprehensive ecosystem applications.

Reflecting on CPU advancements, it is vital to converge technology pathways to shorten the developmental lag behind foreign counterparts, breaking existing ecological barriersSafety remains paramount, necessitating self-research into underlying instruction sets grounded in trust assurance principlesThe ecosystem also becomes increasingly complex, as aligning with differentiated business scenarios and elevating service dimensions brings additional layers of compatibility demands between hardware and softwareThus, as the industry user base expands, filling in the gaps of weak ecosystems becomes increasingly critical.

In a market brimming with potential, the success of domestic computational chip projects will hinge on their ability to adapt to the evolving trustworthiness innovation landscape and address the pressing needs of their clienteleIn this context, Haiguang Information stands out as a leading domestic chip manufacturer meeting the diverse demands of this burgeoning market.

Haiguang's technological innovation credentials have seen significant advancements; through cross-licensing of patents, they have procured a complete x86 instruction set code, enabling self-extension of said instruction setPresently, Haiguang's instruction set has achieved significant independent iteration and development, establishing the indigenous c86 instruction framework, which supports sophisticated security-targeted CPU microarchitecture and systems design.

Moreover, Haiguang's processors are adept at supporting national cryptographic algorithms, which bolster security through the integration of specialized accelerators for security algorithms, thereby enhancing the protection of advanced processorsThe x86 architecture captures over 90% of the global market, and through its c86 initiative, Haiguang has effectively achieved full compatibility with this international standard while also nurturing a localized ecological ecosystem for trustworthiness innovation applications.

To date, Haiguang has cultivated an expansive collaborative network involving over 4,000 enterprises, facilitating more than 8,000 software and hardware optimization initiatives, and jointly developing upwards of 12,000 products and solutions that are secure, efficient, and user-friendly

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To further this ecosystem's growth, Haiguang has established 24 regional branches and 23 compatibility centers, launching initiatives including testing certifications, technical training, incubation of solutions, application demonstrations, and promotional exchanges, thus activating the ecological advantages inherent to domestic foundational hardware products.

Presently, Haiguang's CPU offerings have found extensive application across pivotal sectors such as telecommunications, finance, internet service providers, education, and transportationIts DCU series, grounded in GPGPU architectures, boasts compatibility with general ‘CUDA-like’ environments, fortifying its standing across massive data processing, AI, and commercial computational domainsIn the trustworthiness innovation landscape, Haiguang has solidified its position as a leading choice among domestic computational chip options.

The trustworthiness innovation sector is vast, opening pathways for prolonged growthSince 2023, China's trustworthiness innovation industry has embarked upon a new phase, expanding from governmental foundations into wider civilian markets, ultimately accelerating the release of overall hardware market capacityReports from the China Centre for Information Industry Development predict that the hardware market will reach a valuation of 788.95 billion yuan by 2026.

This expansive market space will not only liberate demand but also usher in a progression toward high-quality overall development of the trustworthiness innovation industryWe find ourselves in the 2.0 era of this sector, where demands for products have evolved from basic functionality to superior performance and usability.

For manufacturers of computational chips, this implies an enhanced need for iterations in hardware performance, software ecological adaptability, and vertical integration of hardware to adeptly navigate market shiftsAnalysis from the Centre for Information Industry Development affirms that domestic CPU manufacturers seeking to bolster their market share in this new phase of trustworthiness innovation must address three pivotal criteria: sustain technological viability, establish robust product iteration capabilities to accommodate diverse downstream demands, and foster a cohesive ecosystem that minimizes software adaptation needs, thus lowering user transition risks and costs, while expanding user options and enhancing value and experience.

Central to these aspirations is achieving ongoing technological development, reliant on firms establishing viable business models

This is fundamental not only to nurturing independent enterprise growth but also to securing long-term stability in the trustworthiness innovation sector.

As it stands, Haiguang Information emerges as a rare domestic chip manufacturer capable of successfully cultivating a synergy between research investments and market salesTheir recently released performance forecast for 2024 indicates an anticipated revenue between 8.72 billion and 9.53 billion yuan, representing a growth of approximately 45.04% to 58.52% year-over-year, with projected net profit between 1.81 billion and 2.01 billion yuan, reflecting growth rates from 43.3% to 59.1%.

In terms of research investment, Haiguang expects to allocate between 3.23 billion and 3.66 billion yuan for R&D in 2024, an increase compared to the previous year, emphasizing their commitment to innovation in the tech-laden high-end processor sectorInsights from analysts at Guosen Securities highlight that this domain is intensely focused on technology, suggesting that through robust R&D endeavors, Haiguang is positioned to elevate its technical capabilities and product quality, thereby fortifying its existing market position and competitive edge.

In the vibrant current milieu of computational stock surges, Haiguang Information’s unique positioning within the trustworthiness innovation sector highlights its extensive growth potentialIts product advantages align seamlessly with the increasing demands of this market, positioning it as a top choice for numerous trust-oriented customersAs the trustworthiness innovation segment continues to expand, Haiguang is well-poised for future growth.

Drawing from the brand strength and technical capabilities nurtured within the trustworthiness innovation sector, Haiguang Information is on a promising trajectory for sustained market growthInsights from interactions with investors reveal that Haiguang has launched collaborative initiatives with leading internet firms, creating a fully domestic integrated software-hardware AI foundational infrastructure, generating numerous model cases poised for substantial progress by 2025.

The arrival of Deepseek has undoubtedly shifted the scales in the ongoing AI algorithm race, tipping the balance towards Eastern advancements

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