China Produces 1.7 Billion Chips Daily! Domestic AI Chip Share Targets 90% Amid Surging Semiconductor Investment

TrendForce's latest forecast predicts that domestic AI chips will account for nearly 90% of China's domestic market this year, doubling from 45% in 2025, with Cambricon and Huawei seen as the primary beneficiaries.

Last year, U.S. AI chip giant NVIDIA still led the market with 2.2 million units shipped, capturing 55% market share. Huawei shipped 812,000 units, securing 20.3%. To close the gap, China must increase its high-end AI chip output by 2.2 times within one year—to approximately 1.96 million units. However, whether production capacity can keep up remains uncertain.

Supporting this ambition is a visible expansion of manufacturing infrastructure. According to data released by China's National Bureau of Statistics in July, integrated circuit (IC) output reached 53 billion units that month, a year-on-year increase of 20.7%. On a daily basis, this translates to about 1.7 billion chips. The cumulative output from January to July totaled 334.2 billion units—already exceeding the annual production of most countries.

Data shows that while China's fixed-asset investment declined 6.7% year-on-year during the first seven months of the year, structural divergence was significant: investments in electronic circuit manufacturing, electronic specialty materials, and IC manufacturing rose 57.7%, 9.4%, and 11.5%, respectively. Information services increased by 19.2%, and network-related services surged 41.3%. Data centers, software, and network infrastructure are being simultaneously strengthened.

Additionally, intellectual property product investment rose 9.1% in the first seven months, increasing its share of total investment by 2.1 percentage points. Equipment and instrument purchases grew 9%, contributing 1.5 percentage points to overall investment growth. Investment in 'buying equipment, conducting R&D, and accumulating IP' now outweighs traditional 'steel-and-concrete' infrastructure spending.

Fu Linghui, spokesperson for China's National Bureau of Statistics, stated that current investment determines future output and industrial layout efficiency. The figure of 1.7 billion chips produced daily is not an isolated data point but a cross-section of the transition from old growth drivers to advanced manufacturing and digital economy.

As demand from AI large models, intelligent driving, and end-user devices pressures the supply chain, capital is flowing into wafer fabs and R&D centers. This underpins the market share gains of Cambricon and Huawei. However, any bottleneck in high-end AI chip yield rates, HBM (High Bandwidth Memory) supply, or EDA (Electronic Design Automation) tool cycles could leave the 2.2x production target stuck on paper.