- Cambricon plans to produce 500,000 AI accelerator chips next year
- The Siyuan 590 and 690 models account for 300,000 units.
- Current yield rates remain extremely low at just 20%.
Chinese chipmaker Cambricon Technologies aims to triple production of artificial intelligence chips by 2026, aiming to fill the gap left by Nvidialeaving the Chinese market.
Bloomberg reports that the company aims to produce about 500,000 AI accelerator chips next year, of which 300,000 units consist of its flagship Siyuan 590 and 690 models.
This represents a sharp increase from the approximately 142,000 units expected in 2025, but Cambricon still faces significant production challenges.
Manufacturing issues and yield limitations
The 590 and 690 chips have a claimed yield rate of just 20%, meaning that only one in five chips released is usable.
Even with access to Semiconductor Manufacturing International's capacity, effective production could fall far below projections.
In comparison, TSMC's 2nm technology, which is seven generations ahead of SMIC's capabilities, achieves 60% throughput, demonstrating the efficiency gap.
Memory shortages, including HBM and LPDDR components, further threaten the ability to meet production targets, potentially slowing delivery to data center customers.
Cambricon's decision comes as Chinese companies such as Alibaba and ByteDance increasingly favor local suppliers.
They are supported by Chinese government incentives to increase China's independence in semiconductors.
Cambricon's revenues grew fourteen-fold in the most recent quarter, reflecting strong domestic demand and investor confidence.
However, the plan would put Cambricon in direct competition with tech giant Huawei, which plans to double its chip output, adding to pressure on Cambricon.
Both companies compete for the same wafers and production resources, creating bottlenecks that can limit the speed and scale of production.
Cambricon's strategy relies heavily on SMIC's 7nm “N+2” process node, but whether it can handle large-scale production remains unclear.
Trade restrictions and a chip embargo imposed last year have limited access to high-end AI hardware, making domestic alternatives essential to the nation's AI ambitions.
The gap between China's current semiconductor technology and Western competitors such as Nvidia AMDAnd Intel remains significant.
Cambrikon's GPU The chips still lag far behind in performance and efficiency compared to the world's top-tier products.
CPU workloads in Chinese data centers may continue to rely on existing infrastructure while AI accelerators expand.
Workstation The integration of these new chips will likely be tested as companies adapt to local hardware limitations.
In a neutral assessment, Cambricon's expansion shows the growing strategic importance of domestic AI chip manufacturing.
Strong government support and growing domestic demand are boosting its momentum, but inefficiencies and competition for resources may limit its full potential.
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