China's chipmaking profits surge 2,579.5% in H1 2026 driven by AI demand

In the first half of 2026, profits for China's leading chip manufacturers soared by 2,579.5%, driven by an unprecedented surge in demand for artificial intelligence and computing capabilities, as reported by the National Bureau of Statistics (NBS) on Monday. Yu Weining, the chief statistician overseeing industrial statistics at the NBS, noted that this increase was due to the rapid integration of AI across various sectors, leading to a significant rise in computing power demand. The electronics industry also experienced a 97% year-on-year profit increase, contributing to the overall industrial profit growth. Profits for major industrial enterprises, those earning over 20 million yuan (US$2.9 million), rose 18.7% to 4 trillion yuan, contrasting sharply with a 1.8% decline to 3.4 trillion yuan in the same period of 2025. Additionally, China's integrated circuit production climbed 23% year on year, totaling nearly 280 billion units—equating to over 1.5 billion chips produced daily.