China’s chip-sector profits surged 2,579.5% in H1 2026, driven by AI demand, says NBS
The National Bureau of Statistics (NBS) reported that profits in China’s semiconductor sector jumped 2,579.5% in the first half of 2026, propelled by unprecedented demand for compute and AI applications.
Why chip profits exploded
The NBS credited the surge to the accelerated integration of AI across multiple industries, which has created massive demand for computing power, according to Yu Weining, chief statistician of the industrial statistics department. The 2,579.5% figure applies to major chip manufacturers, the bureau said in data released Monday.
Sector data and year-on-year comparison
The sharp rise in chipmaker profits is part of a broader upswing: the overall electronics sector reported a 97% year‑on‑year increase in profits. In the first six months of 2026, profits for large industrial firms — defined as companies with annual revenue above 20 million yuan (~$2.9 million) — rose 18.7% to reach 4 trillion yuan. By contrast, in H1 2025 total industrial profits fell 1.8% to 3.4 trillion yuan, and the electronics sector had grown only 3.5%; at that time the NBS did not isolate chip-manufacturing results.
Production and exports climb sharply
Industrial capacity has risen alongside commercial gains: integrated circuit (IC) output grew 23% year‑on‑year in volume to nearly 280 billion units in the first half of 2026 — more than 1.5 billion chips produced per day. The NBS also noted that chip exports increased amid global investment in AI infrastructure and data centers.
Taken together, the figures reflect an industry shift driven by rising demand for high-performance compute and memory to support AI workloads. The official data underscore AI’s role as a near-term growth driver for China’s semiconductor production, although the NBS did not provide detailed breakdowns by chip type, company, or end use.
