China harnesses existing equipment to achieve 7-nanometer craftsmanship.

The global tech analysis firm, Tech Insights, stated on the 4th (local time) that, commissioned by the US-based Bloomberg, it dissected the much-anticipated Chinese Huawei's new smartphone, 'Mate 60'. The findings revealed an indigenously produced 7-nanometer application processor (AP). This AP is identified as the second-generation 7-nanometer chip 'Kirin 9000s' from China's largest semiconductor foundry, SMIC.

Though the 7-nanometer process lags behind the 3-nanometer technology, which is at the center of mass production competition between the world's top two foundries, TSMC and Samsung Electronics, the launch and sell-out of the 'Mate 60' smartphone signifies that Huawei has achieved a degree of successful mass production, even under restrictions on importing cutting-edge semiconductor production equipment like Extreme Ultraviolet (EUV) lithography machines. This casts increasing doubt on the efficacy of the US semiconductor export restriction policy. However, opinions vary on whether Huawei can sustain full-scale production and if the costs and efficiency are justifiable.

Huawei announced that on the 29th of last month, during US Commerce Secretary Gina Raimondo's visit to China, they initiated a limited sale of their new product 'Mate 60' on their official online store, which sold out completely. Chinese official media commented, "This is a victory against US sanctions."

Both Huawei and SMIC are targets of US sanctions. Huawei once stood as the world's top telecommunications equipment company and was hot on the heels of Samsung in the smartphone market. Starting from 2020, Huawei faced sanctions from the Trump administration, restricting its ability to purchase the advanced nanotechnology required for 5G-supported APs.

Last year, to prevent China from advancing its semiconductor research for technologies below 14 nanometers, the Netherlands followed the US in imposing equipment export restrictions on China. The Dutch company, ASML, halted exports of Deep Ultraviolet (DUV) lithography machines to China from the start of this month. According to Tech Insights' analysis, SMIC managed to achieve the 7-nanometer process using their existing DUV equipment.

Following the release of Bloomberg's report, SMIC's share price on the Hong Kong stock market surged by over 11%. However, there were skeptics among investors. Edison Lee, an analyst at the American investment firm Jefferies, commented, "The sell-out of Huawei's new smartphone within a few hours suggests limited inventory; China can only produce a small number of 7-nanometer chips." Conversely, an assessment from another investment firm, Sanford Bernstein, noted, "With cutting-edge packaging technology and relatively low power consumption, Huawei's chips are advancing at 5G-level speeds, a development that surpasses expectations."