AI and Chip Stocks Soar Amidst Global Tech Tension and Market Uncertainty
Despite the global tech tension and market uncertainty, notably in the semiconductor industry, technology giants are doubling down on core technologies, including chips and artificial intelligence (AI). Companies like Xiaomi, MiniMax, and Nvidia are making significant strides, with South Korean investors pouring millions into Chinese AI and chip stocks. However, this boom in investment is leading to an unforeseen problem: a shortage of memory chips.
A Race for Technological Self-Reliance
Xiaomi aims to position itself as a deep-tech player in China's self-reliance push, focusing on chips, AI, and operating systems over the next five years. This move is in line with the broader trend across China's public and private sectors to increase engagement with domestic technology suppliers. For instance, semiconductor designer Moore Threads Technology has achieved full-stack compatibility between its flagship MTT S5000 GPU and Alibaba Cloud's Qwen3.5-series AI models.
Chinese semiconductor giants Hygon and Sugon reported surging revenue for 2025, reflecting strong domestic demand for home-grown computing systems. Meanwhile, Chinese open-source AI models from MiniMax AI and Moonshot AI have topped global token usage, signifying increased international demand for Chinese open-source models.
Navigating the Global Tech War
However, amidst the AI boom, tensions are rising. Nvidia, a primary beneficiary of the global generative AI boom, faces challenges navigating the US-China tech war and has yet to generate any revenue from its H200 chips in China.
Interestingly, Chinese tech giant Huawei has joined hands with US companies OpenAI and Google to advance global open-source standards in the rapidly evolving field of agentic AI, marking a rare collaboration amid US-China geopolitical and tech competition.
Market Reactions and Implications
Despite Nvidia’s record earnings, investor jitters persist, and the memory chip shortage, known as the RAMpocalypse,
is wreaking havoc on the consumer electronics industry. This issue threatens to drive up the price of consumer electronics like laptops, smartphones, and video game consoles.
Meanwhile, in an attempt to catch up to Nvidia in the lucrative world of selling AI chips, AMD announced a major chips-for-stock deal with Meta. However, there are signs of resistance and ethical concerns surrounding AI. For instance, some young adults in France are boycotting generative AI in their daily lives for personal, environmental, or ethical reasons.
Current Status and Future Prospects
As the global tech market continues to evolve, the race for technological self-reliance and the development of AI and chip technologies is reaching new heights. However, with these developments come increased tensions, market uncertainties, and ethical considerations. The future of the global tech market will likely be shaped by these factors, along with the ongoing US-China tech war and how companies navigate these complex dynamics.