Cambricon's 39% Margin Is a Toll on Nvidia's Exile, and Beijing May Lift It
MIIT asked Alibaba and ByteDance to log their planned Nvidia RTX Pro 5500 purchases, and Cambricon fell 5.7 percent the next session. The half-year ledger shows what a closed market pays its champion: RMB 2.3bn of net profit on RMB 5.9bn of revenue.
Vincent Jiang · 3 min read
A ministry form moved the chip board by 5.7 percent
On 27 September, The Information reported that China's industry ministry asked companies including Alibaba and ByteDance to report their plans to buy Nvidia's RTX Pro 5500 chips 1. The ministry told some companies Beijing intends to approve the purchases; Reuters could not verify the report 1.
The next session, Cambricon fell 5.7 percent, Moore Threads 6.3 percent and SMIC 3.7 percent 2. Nothing in Cambricon's silicon changed that day. What moved was the odds that its customers get an alternative.
39 cents on the yuan, on 116,000 chips
Cambricon's first-half revenue and net profit both more than doubled 4, to RMB 5.9bn of revenue and RMB 2.3bn of profit 3: 39 cents of every revenue yuan, counted from the reported figures. The volume beneath that margin is thin: 116,000 accelerators shipped in 2025, one-seventh of Huawei Ascend's 810,000, by one industry tally 3.
Half of 2026 earned more profit than all of 2025
- Revenue
- Net profit
Data
| Revenue | Net profit | |
|---|---|---|
| FY2025 | RMB 6.5bn | RMB 2.1bn |
| H1 2026 | RMB 5.9bn | RMB 2.3bn |
The 2025 baseline was RMB 6.5bn of revenue and a first annual profit of RMB 2.1bn 5. The market paid for scarcity, not scale, pushing Cambricon past RMB 1 trillion in value in late June before a slide to about RMB 700bn 5.
Cambricon shipped 116,000 accelerators in 2025, one-seventh of Huawei's count
Data
| Value | |
|---|---|
| Huawei Ascend | 810k |
| T-Head | 265k |
| Cambricon | 116k |
| Kunlunxin | 116k |
Rationed chips, monopoly prices
The 690, Cambricon's next flagship, has not formally launched, and its indicated price already sits 20 to 30 percent above quotes from two months earlier 6. Huawei's 950DT carries an indicated price above RMB 250,000, up as much as 50 percent, because grey-market high-bandwidth memory costs Chinese buyers several times the world price 6.
Supply binds, not demand: Huawei's rotating chairman Eric Xu says the company cannot satisfy domestic orders and is limiting overseas sales 7. DeepSeek reportedly lines up at least 160,000 Huawei 950DTs for Inner Mongolia, a wait reports put past a year 8. Iluvatar CoreX doubled GPU shipments to ByteDance to 100,000 units this year, plugging the same gap 6.
A survey is not a license
Nvidia says a mix of outdated US export controls and China's own import limits still binds its sales 1, and the RTX Pro 5500 is a workstation card outside the accelerator class Washington blocks 2. Bernstein puts Nvidia near 8 percent of China's AI chip market by mid-2026, with the high end already domestic; a broader caliber still credits it about 55 percent 3.
The watch items are whether the ministry turns the survey into approvals, the 690's formal price at launch, and Cambricon's RMB 13.5bn 2026 revenue target, the trigger for its staff incentive plan 5. A crack at the low end does not reprice the top, and the summit's $30bn tariff exemption never touched AI chips 2. The margin was never printed on the silicon. It sits in the ministry's in-tray.
More about NVIDIA
NVDA · Fiscal Q2 2027Revenue rose 106% to $96.2B, 92.5% of it from Data Center, “driven by the ramp of our Blackwell Ultra infrastructure”. Gains on equity stakes of $7.8B lifted net income to $59.7B.
Show as a table
| Line | Value |
|---|---|
| Revenue | $96.2B |
| Gross margin | 75.0% |
| Operating margin | 66.2% |
| Net income | $59.7B |
| Hyperscale | $48.7B |
| AI clouds & enterprise | $40.3B |
| Data Center | $89.0B |
| Edge Computing | $7.2B |
| Gross profit | $72.1B |
| Cost of revenue | $24.1B |
| Other income | $7.8B |
| Operating income | $63.7B |
| Operating expenses | $8.4B |
| Tax | $11.8B |
| R&D | $7.1B |
| SG&A | $1.4B |
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
