China’s top AI accelerator and CPU makers are bleeding tens of millions — Longsoon and Cambricon losses continue despite billions in government subsidies

Chip designers in China, particularly Loongson and Cambricon Technologies, are facing significant financial challenges in 2023. Loongson, a leading CPU developer, is projected to experience a 31% year-over-year decrease in revenue and an expected loss of ¥310 million, attributed to a sluggish market for industrial chips and high research and development expenses. Similarly, Cambricon Technologies, specializing in AI chips, is anticipating a full-year loss of up to ¥924 million, with decreased sales and the loss of Huawei as a major client contributing to their financial struggle. The narrow product lineups of these companies and their inclusion on the US Commerce Department’s Entity List further exacerbate their challenges, as they face limitations in procuring advanced American-origin technologies and addressing certain customers. These struggles reflect broader disruptions in China’s semiconductor and supercomputer sectors, as the US tightens sanctions against these industries.