According to the whistleblower Jukan, citing Morgan Stanley's report, it is said that due to the continued low yield, the prospect of the future AI GPU chip business of China's chip foundry Longtou SMIC has been significantly revised. The re...
According to the whistleblower Jukan, citing Morgan Stanley's report, it is said that due to the continued low yield, the prospect of the future AI GPU chip business of China's chip foundry Longtou SMIC has been significantly revised. The report shows that the yield of the Ascend series AI chips produced by SMIC this year is only about 30%, making the original revenue estimates for 2025-2027.
Morgan Stanley: This year, SMIC will start at 7,000 12-inch washers per month, increasing to 13,000 next year and 18,000 in 2027 for AI semiconductors.
Morgan Stanley: The wafer yield of the 910B that SMIC is currently producing is around 30%. pic.twitter.com/jUIgrPmsDM
— Jukan (@Jukanlosreve) September 6, 2025
Currently, SMIC can produce about 7,000 wafers per month, mainly used for Ascend 910B wafers, and plans to transform to 910C in 2026. Since the 910C adopts a dual-grain design, a 12-inch crystal circle can cut out 78 910B or 39 910C, making the capacity limitation more prominent. Morgan Stanley estimates that a 910B sells for about 50,000 yuan, while 910C costs about 110,000 yuan.
Due to restrictions on US sanctions, SMIC cannot obtain ASML's EUV equipment. Currently, it can only rely on DUVs to produce 7-nanometer chips through multiple exposures. This method significantly increases the process steps, which not only increases costs, but also leads to difficult yields. Morgan Stanley predicts that although the SMIC 910B yield can gradually improve, it will not reach 70% as soon as 2027.
Financial measurement data shows that Morgan Stanley originally estimated that SMIC's AI GPU chip revenue could reach 1.46,107 / 212,023 / 286,567 million RMB respectively from 2025 to 2027; but after the latest correction, only 58,457 / 94,087 / 1.36,082 million RMB remained, almost half cut.
Despite technical restrictions on advanced processes, the Chinese government is actively promoting related policies to support local semiconductor development. Among them, the third phase of the "Big Fund" has injected more than RMB 344 billion (about NT$147.23 billion) into the semiconductor and AI chip fields; at the same time, it promoted "Project Spare Tire", with the goal of achieving a domestically-profit rate of 70% of AI chips by 2028. This shows that although SMIC is facing technical bottlenecks, it still has strong support from policies and funds.
Morgan Stanley Guts SMIC’s Huawei AI GPU Revenue By More Than 50% Due To Abysmal Yields
