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- 📲 Huawei: Chips Weaker But Competitive
📲 Huawei: Chips Weaker But Competitive
Reading time: 4 min 45 sec
☕️ Good morning comrades!
China is in the thick of the Gaokao, the Chinese high-school exit exam. To put a stop to cheaters, DeepSeek temporarily disabled several features.
But don’t panic! It’s back up and running. We were already dreading having to look up for ourselves what the capital of Burundi is (Gitega) or what else you can put in your coffee besides butter…
Speaking of a blockade: the former head of the American Chamber of Commerce in China says the US will “simply find alternatives” if China continues to withhold rare earths. We’re eager to see what happens…
🔢 Facts & Figures
150,000
JD plans to hire this many additional full-time delivery drivers on top of its existing 100,000 to strengthen its nationwide logistics and food-delivery network.
US$ 1.26 billion
Tencent Music acquired the online audio platform Himalaya for this sum; Himalaya will operate as a wholly owned subsidiary going forward.
US$ 1.5 billion
Size of Indonesia’s stimulus package, which includes cash handouts and rice allocations to cushion the impact of US tariffs.
🚀 Benchmarks
| Index | Current | 24 h | YTD | 52 W High |
|---|---|---|---|---|
| 🇩🇪 DAX | 23 987.56 | –0.77 % | +20.5 % | 24 325.97 |
| 🇺🇸 NASDAQ | 19 714.99 | +0.63 % | +1.1 % | 20 204.58 |
| 🇯🇵 NIKKEI | 38 388.20 | +0.46 % | –4.22 % | 42 426.77 |
| 🇭🇰 Hang Seng | 24 191.32 | +0.03 % | +17.9 % | 24 874.39 |
| 🇨🇳 Shanghai | 3 384.82 | +0.43 % | +0.99 % | 3 674.40 |
| 🇰🇷 KOSPI | 2 889.33 | +0.61 % | +20.4 % | 2 904.21 |
Top Bit: 📡 Huawei Counters US Sanctions with Cluster Technology
In an interview with People’s Daily, Huawei CEO Ren Zhengfei admitted that Huawei’s chips lag a generation behind US technology. However, through cluster computing, advanced mathematics, and new chip architectures, the company can still deliver competitive AI performance—despite US sanctions.
Details
🧠 Cluster over power chip: Huawei uses massive compute clusters (“AI CloudMatrix 384”) with hundreds of Ascend-910C chips—outperforming Nvidia’s top model in some tasks.
🔬 ¥180 billion for R&D: One third is allocated to theoretical foundations—Ren calls this the key to one day catching up to the US.
📦 Pragmatic approach: “Our individual chip is weaker, but we combine mathematics with physics. Software is not the bottleneck.”
📉 Sanctions falling short: Despite export bans, China's AI applications and chip designs continue to advance.
🗣️ Modest—but pointed: “The US overestimates Huawei,” Ren says. “We must work hard to deserve that valuation.”
Why it matters
Tech war workaround: Despite the blockade, Huawei shows how innovation pressure and state support can pay off.
AI as geopolitical race: Huawei is challenging Nvidia on its home turf—though the US market remains closed.
Signal to China’s chip industry: Huawei sees itself as “one among many,” with a clear goal of gradually closing the US gap.
Background
Since 2019, Huawei has faced strict US export restrictions, barring it from sourcing high-end chips or production equipment from the West. Yet in 2023 it surprised the market with a 5G smartphone powered by a self-developed chip. The new strategy leans heavily on chip stacking, theoretical research, and massive investments in AI infrastructure—most recently as a response to US curbs on Nvidia chips.
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Head Of The Day
Guo Pei
👗 From textile factory worker to haute-couture icon: Guo Pei began her career in a factory before founding her own fashion house in 1997. She achieved international breakthrough in 2015 with Rihanna’s canary-yellow Met Gala gown, which took over 50,000 hours to create and was adorned with 200,000 Swarovski crystals. In 2016 she became the first Asian guest member of the Chambre Syndicale de la Haute Couture and made her debut at Paris Fashion Week in 2017. Her opulent creations are celebrated in museums and exhibitions around the world, and she still lives in Beijing. We’ve checked—unfortunately, you can’t buy her collections on Shein.
Market Bit: 🚚 Temu & Shein Set Sights on Europe
Details
☁️ Looming US tariffs threat: Temu lost 48 % of its US daily active users in May after the De Minimis exemption ended, while Shein recorded a 13 % drop in revenue.
🇪🇺 Europe focus: In the EU, Temu’s consumer spending rose 63 % and Shein’s by 19 %; in the UK those figures were 38 % and 42 % year-on-year.
🛠️ Operational expansion: Both platforms are ramping up digital-ad budgets in the UK and France, expanding warehousing capacity, and localizing their business models.
🤝 Sustainability obligations: The upcoming EU due-diligence directive will require disclosure of human-rights and environmental standards across supply chains.
Why it matters
Consumer prices: Shoppers benefit in the short term from rock-bottom deals but may face new EU fees and higher compliance costs down the line.
Global trade: The shifts illustrate how trade disputes and protectionism are reshaping international supply chains and e-commerce models.
Competitive pressure: The aggressive push by Chinese platforms is forcing traditional retailers and logistics providers worldwide to modernize.
Top Reads
🌍 World Bank Slashes 2025 Forecast: Due to higher tariffs and uncertainty, the global economy is now expected to grow only 2.3 %—the weakest non-recession year since 2008. World trade is losing steam (down 1.6 pts to 1.8 %), and inflation remains at 2.9 %, above pre-Covid levels. According to the model, an additional 10-point tariff hike could shave another 0.5 pts off growth. More on this.
🔆 China’s Solar Industry Seeks an Exit: Overcapacity, price wars, and new US tariffs are squeezing margins. At the SNEC expo in Shanghai, industry veteran Zhu Gongshan urged more innovation instead of ruinous cost battles to return to profitable growth. More on this.
🚗 Honda Bets on Hybrids for Now: The automaker is cutting its EV investments from ¥10 trillion to ¥7 trillion and is making profitable hybrid models the core of its transition strategy to stabilize margins and regain investor confidence. More on this.
Optional Reads
USA: Trump’s travel ban hits Southeast Asia for the first time. More on this.
China: Ping An Bank entices young customers with Pop-Mart Labubu figurines. More on this.
Singapore: Qantas will shut its low-cost subsidiary Jetstar Asia at the end of July and invest A$500 million in a new fleet. More on this.
🏀 The 2.26 m Monk: NBA superstar Victor Wembanyama was spotted at the 1,500-year-old Shaolin Temple in Henan. The 21-year-old Frenchman shaved his head and retreated for ten days of silence and Kung Fu practice to hone his meditation, discipline, and physical control.
NBA China confirmed his ten-day monastery stay via Weibo, while Shaolin representatives said they “aren’t at liberty to share many details.” Before that, Wembanyama visited Beijing, went shopping, played pickup basketball, and explored the Great Wall. Now he’s swapping three-pointers for wooden staves and inner reflection—so he can return to the NBA stronger and more focused.
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Thomas, Michael & the Team of asiabits.
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Editors: Michael Broza, Thomas Derksen, William Hu, Eva Trotno, Cindy Zhang
Content responsibility: Thomas Derksen
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