Leading Chinese AI chipmaker Moore Threads surged 425% in debut trading in Shanghai after raising 8 billion yuan (€970 million), marking the biggest first-day pop for a major IPO.
It marks one of the biggest deals since China overhauled its listing rules in 2019, when Beijing introduced a Nasdaq-style listing system on its STAR Market to make it easier for high-tech companies to go public.
Founded in 2020 by Zhang Jianzhong, a former senior executive of Nvidia in China, Moore Threads is considered a second-tier domestic chipmaker. That’s because its GPUs remain less advanced, less energy efficient, and less deployed than those of Huawei’s HiSilicon or leading AI chip designer Cambricon, which dominate China’s high-end data center and AI training markets.
China’s semiconductor stocks have risen this year as the United States maintains heavy controls on advanced chip exports to the country.
Washington’s export control regime, first designed under former President Joe Biden’s administration, restricts Nvidia, AMD and other US firms from selling their most sophisticated AI processors to China and targets loopholes that allowed “China-only” chips to bypass previous rules.
The justification is that limiting access to high-level technology is intended to slow China’s progress in military AI, cyber operations, and mass surveillance, therefore protecting US national security.
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In the short term, these restrictions largely shut China out of the world’s most advanced US-made accelerators, forcing them to train and deploy large language models on less capable and less efficient hardware. This widens the performance gap with US rivals as global competition in generative AI intensifies.
However the long-term effects run in the opposite direction. By denying Chinese firms access to top-tier foreign chips and chip-making tools, Washington has intensified Beijing’s long drive for semiconductor autonomy.
The response from Chinese leaders was to implement subsidies and emergency funding, which helped technology giants such as Tencent, Alibaba and ByteDance to phase out Nvidia where possible and accelerate the use of domestic alternatives.
That combination created a vast and protected domestic market for Chinese chipmakers. Even when domestic products lag behind in advanced Western processing, they enjoy a protected market where China can focus on local demand and that of companies in non-US markets such as the global south. It’s similar to the Huawei effect, where US bans led to initial disruption followed by rapid, state-backed replacement and catch-up.