Please note, this content does not serve as investment advice. The author does not hold any shares in the companies discussed.
Cambricon Technologies: A Rising Star in AI Chips
Cambricon Technologies, widely recognized in China by its local name Hanwuji, has emerged as a frontrunner in the AI chip sector. Recently, its stock price has surged by an impressive 130% over the past two weeks. Despite this promising performance, the company grapples with substantial risks, primarily stemming from its dependency on a limited customer base.
Historical Context and Financial Struggles
Previously dubbed the “king of losses, ”Cambricon reported cumulative losses of approximately 5 billion yuan (around $970 million) as of the close of 2024. The situation worsened in 2022 when the US Commerce Department placed the company on its Entities List, triggering a significant downturn in operations.
A Fortuitous Turn of Events
The landscape shifted dramatically with the US export restrictions on AI chips imposed in April, requiring stringent licensing for NVIDIA and AMD to sell GPUs in China. This development inadvertently provided Cambricon with a lifeline, enabling a resurgence in its business activities.
Future Projections and Performance
Current forecasts by Goldman Sachs predict that Cambricon will ship about 145, 000 units of its custom AI chip in 2025. However, this figure is expected to skyrocket to over 2.3 million units by 2030. This optimistic outlook underscores the company’s growth trajectory in the competitive AI hardware market.
The recently introduced Siyuan 590 chip is particularly noteworthy, as it boasts approximately 90% of the performance output of NVIDIA’s A100 GPU, with a TPP of 4, 493, compared to 4, 992 for the A100. This positions Cambricon favorably as it navigates this fast-evolving industry.
Remarkable Revenue Growth
During the first half of 2025, Cambricon experienced a staggering revenue increase of 4, 348%, totaling $402 million. This explosive growth appears to be positively influencing its stock price as well.
In light of these developments, it comes as no surprise that Goldman Sachs has once again raised its price target for Cambricon shares, now set at 2, 104 RMB for the second time in just two weeks.
Goldman Sachs estimates Chinese AI chipmaker Cambricon’s AI chip shipment will reach 1.09 million in 2028 and 2.33 million in 2030. It also raised the TP to 2, 104 RMB for the second time within about 2 weeks.pic.twitter.com/bnX9mHR8t8
— Ray Wang (@rwang07) September 1, 2025
Customer Concentration Concerns
Despite the bullish forecasts, serious risks loom. A staggering 94.6% of Cambricon’s sales come from just five customers—the single largest client alone represents an overwhelming 79.1%.This concentration risk is further evidenced by the fact that this client constitutes 42.5% of the company’s total receivables (approximately ¥1.22B).
Cambricon’s 1H25 report is eye-opening. The top 5 customers made up 94.6% of sales — and one client alone was a staggering 79.1%.On the balance sheet, it’s the same story: that single customer accounts for 42.5% of all receivables (¥1.22B).This basically means Cambricon is… pic.twitter.com/ATMNLNtYdO
— Poe Zhao (@poezhao0605) September 1, 2025
Competitive Landscape and Future Outlook
As Cambricon continues to grow, it faces significant competition from established players like Huawei and Alibaba, both of whom possess deep financial resources. Nevertheless, with Goldman Sachs consistently upping its stock price target, Cambricon appears poised to reach new market capitalization heights despite inherent risks.
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