Market Trend（May.20）

Russia announces breakthrough in lithography machines, self-developed approach breaks Western blockade

In May 2026, Russia officially announced a dual breakthrough in the field of lithography machines: first, the country’s first domestically developed commercial lithography system, ProgressSTP-350, has completed mass production and delivery; second, the 6.7-nm gas-target EUV light source has achieved critical laboratory progress, marking a differentiated indigenous development path.

Developed by the Zelenograd Nanotechnology Center in Moscow, the ProgressSTP-350 employs 350-nm i-line lithography technology and replaces traditional mercury lamps with solid-state lasers. It supports 200mm wafer production with alignment precision of 90nm, primarily serving aerospace, radar, and industrial control applications, with radiation resistance and stability tailored for military applications. Meanwhile, the 6.7nm gas-target technology discards ASML’s tin-droplet light source approach and explores a new ultra-short-wavelength EUV path, theoretically supporting 3nm and below process nodes, breaking the Western technological monopoly.

Amid long-term Western semiconductor restrictions, Russia prioritizes autonomous “from scratch” production capacity over chasing cutting-edge nodes. This breakthrough fills the domestic commercial lithography machine gap, strengthens defense and industrial chip supply, and introduces new dynamics into the global semiconductor equipment competition.

Comments:Russia’s breakthrough in lithography machines exemplifies “asymmetric competition” under sanction pressures. The core lies in abandoning the pursuit of cutting-edge nodes, focusing on self-reliance, and exploring new technological paths, with far-reaching implications for the global semiconductor landscape. The mass production of the 350nm lithography system addresses the critical “bottleneck” needs of military and industrial chips, offering high stability and strong interference resistance that aligns with Russia’s defense system requirements. Meanwhile, the 6.7nm gas-target EUV light source takes a novel approach, circumventing ASML’s patent barriers and opening new possibilities for the post-EUV era. Though still distant from industrial-scale deployment, its strategic value is significant.

This move signifies Russia’s formal exit from the Western-dominated semiconductor equipment ecosystem, establishing an independent and self-controlled domestic ecosystem while weakening the deterrent effect of Western sanctions. For the global industry, it disrupts the narrative of high-end equipment monopoly, demonstrating that embargoes can, paradoxically, drive indigenous innovation and provide a reference model for other sanctioned nations.

02

Company Trend（May.21）

AMD bets over US$10bn on Taiwan, aggressively pushing AI advanced packaging and compute infrastructure

On May 21, 2026, AMD officially announced an investment exceeding US$10bn in Taiwan’s semiconductor and AI ecosystem, fully ramping up efforts in advanced packaging and AI compute infrastructure to meet the explosive global demand for AI compute. The investment focuses on two main directions: first, partnering with leading players such as ASE and SPIL to mass-produce EFB 2.5D advanced packaging, supporting the production ramp-up of the sixth-generation EPYC (Venice) CPUs and Instinct MI450X GPUs; second, collaborating with ODMs including Wiwynn and Wistron to advance the Helios rack-scale AI platform, targeting gigawatt-level deployment in the second half of 2026.

AMD CEO Dr. Lisa Su emphasized that AI demand is outpacing capacity expansion, and the Taiwan supply chain is key to overcoming high-end packaging bottlenecks and delivering AI systems rapidly. This multibillion-dollar investment spans technology R&D, capacity expansion, and ecosystem collaboration. It represents AMD’s strategic push to compete with NVIDIA and capture the AI compute market while profoundly influencing the global advanced semiconductor manufacturing and AI infrastructure landscape.

Comments:AMDs US$10 bn investment in Taiwans ecosystem represents a strategic move to challenge NVIDIAs AI hegemony and secure a foothold in advanced manufacturing. This bold maneuver is set to profoundly reshape the competitive dynamics of the global semiconductor and AI industries. At the technical level, the deployment of EFB packaging and the Helios platform will tackle fundamental interconnect bandwidth and energy efficiency bottlenecks for high-end AI chips, reinforcing AMDs leadership in small-chip architectures and rack-level compute solutions.

This move strategically positions AMD within Taiwans global advanced packaging and manufacturing hub, securing production capacity and significantly shortening AI product delivery cycles, directly challenging NVIDIAs monopoly in the high-end AI compute market. Simultaneously, the US$10bn investment is expected to drive synergistic upgrades across the islands semiconductor equipment, substrate, and ODM ecosystem, amplifying the regional industrial cluster effect.

AMDs aggressive capital deployment will intensify the AI compute arms race, positioning advanced packaging as a core industry competitive advantage, and compelling a global semiconductor supply chain realignment. For Chinas semiconductor industry, this underscores the importance of advanced manufacturing and ecosystem collaboration, while providing key lessons for domestic substitution: only by focusing on core technologies and securing high-quality production capacity can local players gain strategic leverage in the AI era.

03

Company Trend（May.22）

18A enters mainstream market, Intel launches AI PC adoption campaign

In May 2026, Intel officially deployed its 18A (1.8nm) process technology to mainstream PC platforms, launching the third-generation Core processors (Wildcat Lake), marking the full-scale entry of advanced process nodes into the consumer PC market. The processor integrates RibbonFET gate-all-around architecture and PowerVia back-side power delivery, reducing power consumption by 64% compared to its predecessor, boosting GPU AI performance by 2.7×, and delivering platform compute of 40 TOPS, capable of supporting edge-to-cloud hybrid AI workloads. Simultaneously, Intel collaborated with partners including Lenovo and ASUS to launch over 70 device models, rolling out the “Firefly Initiative” to accelerate ecosystem adoption and officially kick off the mass-market campaign for AI PCs. This move breaks the premium barriers of high-end process nodes, addresses the imbalance between performance and battery life in mainstream PCs, and drives AI PCs from a high-end concept into the mass-market segment.

Comments:Intels deployment of the 18A process to the mainstream market marks a critical inflection point for the AI PC industry, transitioning from "early adoption" to "mass adoption," combining both technical breakthroughs and strategic significance. On the technical front, the 18A process, Intel’s first mass-produced sub-2nm node, has exceeded yield expectations, demonstrating a return to robust manufacturing capability. The integration of RibbonFET and PowerVia addresses energy efficiency challenges at the fundamental level, providing low-cost, high-performance support for edge AI applications. From a strategic perspective, Intel proactively disrupts the "exclusive high-end process" logic, rapidly expanding AI PC penetration through technology downscaling for mainstream adoption, squeezing competitors’ mid-tier market share and consolidating its leadership in the PC processor segment.

This move is expected to accelerate the maturation of the AI PC ecosystem, compelling the supply chain to achieve cost efficiencies and driving AI applications from high-end scenarios to broader domains such as office and education. At the same time, process democratization also implies compressed profit margins, making future profitability reliant on ecosystem scale effects and software service monetization. In the long term, the widespread adoption of the 18A node will reshape the competitive rules of the PC industry, with energy efficiency and AI capabilities supplanting traditional specifications as the key battleground, ushering the sector into a new era of "AI computing for all."

04

Market Trend（May.22）

ASML CEO warns: chips will face long-term shortages

Christophe Fouquet, CEO of global lithography giant ASML, recently issued a public warning that driven by the explosive demand for AI computing power, the global semiconductor market will remain supply-constrained for the long term, with chip shortages potentially persisting for several years. Speaking at the Imec ITF conference, he emphasized that AI demand far outpaces industry capacity expansion, and supply chain bottlenecks are expected to recur repeatedly.

Currently, tech giants such as Google and Microsoft are investing nearly US$700bn annually to expand data centers, directly triggering a surge in demand for advanced logic and memory chips. Coupled with the rollout of new projects such as Elon Musk’s TeraFab ultra-large-scale chip factory and Starlink satellite data centers, chip demand expectations are further elevated. Fouquet predicts that by 2030, the global chip market will reach US$1.5tn, nearly double the size of 2025.

Despite aggressive capacity expansion by TSMC, Samsung, and Intel, and ASML accelerating EUV equipment output, the long delivery cycles and high technical barriers of advanced process equipment mean that the supply-demand gap will be difficult to close in the short term. At present, memory chips have already entered a supply-shortage phase, and the tightness in advanced logic chips is expected to continue.

Comments:ASML CEOs warning points to a profound shift in the semiconductor industry, moving from “cyclical fluctuations” to “structural scarcity,” with the core tension now being the long-term mismatch between AI computing demand and limited high-end production capacity. Technically, the capacity for advanced processes relies heavily on EUV equipment concentrated at ASML, and the ramp-up of new machines such as High-NA EUV is slow, leaving production expansion significantly lagging behind demand.

From a strategic perspective, prolonged chip shortages will reshape the balance of power in the supply chain: upstream equipment and core IP vendors will see strengthened pricing power, leading wafer foundries to continue benefiting from advanced process barriers, while mid- and downstream brands may face rising costs and delivery delays. Meanwhile, the shortages will compel global supply chains to accelerate local production strategies, with geopolitical factors further exacerbating regional supply-demand imbalances.

Long-term chip shortages are set to become the new normal in the industry, where compute-first and capacity-is-king will replace traditional price competition. This trend creates a window of opportunity for domestic semiconductor equipment and materials companies to advance local alternatives, while imposing higher demands on industry coordination and technological breakthroughs. In the future, ensuring stable supply of advanced capacity will become the decisive factor in corporate competition.

05

Company Trend（May.19）

Wuhan Xinxin terminates STAR Market IPO, US$4.8bn fundraising plan collapses

On May 19, 2026, the Shanghai Stock Exchange officially terminated the STAR Market IPO review of Wuhan Xinxin Semiconductor Manufacturing Co., Ltd. The company and its sponsor voluntarily withdrew the application, abruptly ending an eight-month listing process. As the largest NOR Flash foundry in the Chinese Mainland, Wuhan Xinxin had its IPO accepted on September 30, 2024, with an original fundraising target of RMB 4.8bn, intended for the Phase III expansion of its 12-inch production line and R&D on specialty processes.

The termination was driven by three major pressures: First, regulatory scrutiny over independence, as the company was previously a wholly owned subsidiary of Yangtze Memory Technologies and now also belongs to the Yangtze Memory Group, raising concerns over related-party transactions and potential competition within the group; second, performance turning from profit to loss, with a projected net loss of RMB 250–280mn in the first three quarters of 2025. The heavy-asset model led to annual depreciation exceeding RMB 1.2bn, compounded by industry downturns and price wars, significantly squeezing profitability; third, strategic adjustments within the group, as Yangtze Memory simultaneously commenced IPO counseling, elevating the priority of the parent company’s listing.

This termination reflects the common challenges faced by domestic specialty-process foundries: amid cyclical volatility, capital constraints, and group-level integration, independent IPOs have become increasingly difficult, and industry resources are progressively concentrating among leading players.

06

Company Trend（May.20）

SMIC and Huahong Group join forces to establish supply chain company with RMB 200mn registered capital

On May 20, 2026, Shanghai Electronic Materials International Supply Chain Center Co., Ltd. was officially established. The company is jointly funded by SMIC, Huahong Group, and several other state-owned enterprises and industry platforms, with a registered capital of RMB 200mn. This marks the first time that China’s two leading semiconductor manufacturers have deeply collaborated at the upstream materials supply chain level, directly targeting critical bottlenecks such as photoresists, specialty gases, and wet chemicals.

The new company’s shareholder lineup combines “manufacturing + chemical + supply chain + industrial park”: SMIC holds the controlling stake, Shanghai Huahong Investment & Development (Huahong Group) serves as a core initiator; Shanghai Huayi Holdings provides chemical technology support; HMG Digital Technology oversees the digital supply chain; and Shanghai Chemical Industry Park Development Co., Ltd. offers industrial implementation space. The business scope includes sales of electronic specialty materials, component wholesale, supply chain management, and cross-border e-commerce.

For a long time, China’s high-end semiconductor materials have been heavily dependent on foreign sources, with overseas restrictions amplifying supply risks. Meanwhile, wafer fabs often procure materials independently and conduct separate validations, resulting in high costs and long lead times for domestic material adoption. The new company aims for unified procurement, unified validation, and unified standards, reducing costs through centralized bargaining and establishing a shared testing platform to accelerate the adoption of domestic materials in advanced processes.

This joint venture represents a critical step for China’s semiconductor industry in moving from “single-point breakthroughs” to a “systematic and self-controllable” approach. It will strengthen supply chain resilience, reduce reliance on overseas supply chains, and secure material support for the expansion of advanced process capacity.

07

Company Trend（May.21）

Anhui Northern Microelectronics Research Institute achieves mass production process breakthrough for high-end optical communication chips

On May 21, 2026, Anhui Northern Microelectronics Research Institute Group announced a major breakthrough in the mass production process of MEMS-OCS array micromirror chips. The institute has successfully mastered the complete set of autonomous manufacturing technologies, breaking long-standing foreign monopolies and filling critical gaps in China’s high-end optical communication components.

MEMS-OCS serves as the core chip for optical circuit switching, enabling high-speed routing of optical signal channels in data centers and all-optical networks. It has extremely high technological barriers and was previously almost entirely imported. This breakthrough focuses on the development of high-end chips with 256 and 1024 ports, overcoming key processes including precision etching, low-stress thin film deposition, high-precision bonding, and high-reflectivity mirror surface fabrication, establishing a fully autonomous micro-nano manufacturing system.

The chip offers rapid response, high precision, low loss, and strong stability, reaching industry-leading performance levels. It fully meets the requirements of all-optical networks and AI computing infrastructure. The process has now been finalized and entered iterative mass production, strongly supporting the autonomy and control of China’s optical communication supply chain, advancing Anhui’s “China Sensing Valley” initiative, and providing critical support for high-speed optical interconnects in the AI era.