Chinese chip stocks rose after Huawei launched the new Mate 60 Pro phone

SHENZHEN, China/SHANGHAI (Reuters) – Chinese chip stocks rose on Wednesday after Huawei Technologies Inc (HWT.UL) launched its new Mate 60 Pro phone, as investors speculated that it might use a 5G-capable chip which, if True, that would be a win for China’s domestic semiconductor sector.

Since 2019, Washington has blocked Huawei from buying advanced chips and software from US companies, decimating its consumer electronics business and leaving it only able to launch limited batches of 5G models using stock chips.

But research firms told Reuters last month that they believe Huawei plans to return to the 5G smartphone industry by buying chips locally, using its own developments in semiconductor design tools as well as chipmakers from Semiconductor Manufacturing International Co (SMIC). Huawei declined to comment at the time.

On Tuesday, the company started selling the Mate 60 Pro at around midday for 6,999 yuan ($960) in an unusually simple way, without giving any advance notice or making advertisements. Huawei employees and sales staff at stores in Beijing and Shenzhen told Reuters they were surprised.

The specifications provided for the Mate 60 announced its ability to make satellite calls, but did not provide any information about the power of the internal chip.

However, online users who were able to purchase the phone began posting videos of themselves running tests that they said showed it could match network speeds of phones with 5G chipsets as well as screenshots indicating that it uses the Kirin 9000s chip. Reuters was unable to verify these allegations.

The phone’s launch also rose to become the top-searched topic on Weibo, the Chinese version of the X, on Wednesday, with enthusiastic netizens saying the launch marked the overcoming of US restrictions.

In a sign that the phones were selling out quickly, by the afternoon, Huawei’s website said that buyers would not be able to receive their phones until as early as September 17.

Huawei, whose problems with Washington have become a major flashpoint in US-China relations, declined to comment on whether the phone could support 5G networks, but said in a statement that the Mate 60 series is the most powerful Mate model ever.

The launch of the Mate 60 Pro also coincided with US Commerce Secretary Gina Raimondo’s visit to China. On Tuesday, it said the United States had rejected a Chinese request to reduce export controls on the technology.

Chip shares jump

China’s semiconductor sector (.CSIH30184) jumped more than 2.5% on Wednesday, extending the weekly gain to about 8%. Shares of China Semiconductor Manufacturing International rose nearly 10% for the week.

Retail investor Lu Deyong said he bought shares in semiconductor company Sai MicroElectronics Inc (300456.SZ), which has business ties with Huawei, and the technology-focused STAR 50 (.STAR50), after launching Huawei’s new phone.

“The stocks went up and I saw a large amount of money flowing in, which showed a very good attitude towards the launch and the technology behind it,” Lu said. “I can’t confirm if the technology is original, but I hope it is.”

Nicole Peng, senior vice president of mobility at Canalys, said it would be important for Huawei to provide clarification on its technology, given the high level of market interest.

“If it is indeed true that Huawei is able to develop its own 5G SoC (System on a Chip) beyond the current development timeline of the industry, then this indicates a huge leap in its R&D capabilities. It creates great disruption in the semi-industrial industry and especially in its field She said competitors.

“On the other hand, the suspicion surrounding Huawei’s ability to develop a 5G SoC and its vagueness about the product and its launch could hurt its long-term credibility. It could go south if the claims are false.”

($1 = 7.2897 CNY)

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