Rebirth 08: Rise from copycat phones

Chapter 283 Bought it and ruined it

As the market changed and the stock price came under downward pressure, Nvidia's board of directors was forced to make certain adjustments to its management, while continuing to conduct active secret negotiations with Zhiyun.

In addition, Zhiyun also contacted NVIDIA's existing management, conveyed goodwill to the management, and dispelled their concerns: Don't worry, you will not be fired after the company is acquired, but will continue to work in NVIDIA, and after becoming a part of Zhiyun Group, you will also have the opportunity to make further progress in industry.

You have to know that Nvidia's market value of 700 to 800 million US dollars seems to be not small, but its annual revenue is only more than 4 billion US dollars. A company of this level is actually just an ordinary technology company. In the huge Zhiyun Group, it is not even as important as a subsidiary.

Even if we don't talk about other things and only talk about the GPU business, the GPU business unit of Zhiyun Semiconductor under Zhiyun is larger than that of Nvidia alone... Zhiyun Semiconductor's mobile GPU business is the world's number one, with annual shipments of more than 500 million built-in GPUs.

Now it is entering the PC market, and its future prospects are huge.

After acquiring NVIDIA in the future, Zhiyun's GPU business unit will merge with NVIDIA to become a comprehensive GPU business unit, and NVIDIA will become an important subsidiary of this business unit.

This means that the existing management team at NVIDIA will have the opportunity to further serve as senior management of Zhiyun Group’s GPU business unit.

And on the Internet, there is also the behemoth Zhiyun Semiconductor!
Although Zhiyun Semiconductor is just a subsidiary of Zhiyun Group, it is actually one of the world's top chip design companies, with annual revenue of tens of billions of dollars and net profit of tens of billions of dollars.

If Zhiyun Semiconductor were to be split off and listed separately, it would definitely be a large company with a market value of one or two thousand US dollars.

This scale is unmatched by NVIDIA.

Now, Zhiyun told Nvidia’s management that as long as they agree to the acquisition and become part of Zhiyun, they will have the hope of taking further steps in their careers... no, maybe even several steps.

It is also possible that he will be in charge of a core subsidiary with a market value of one or two hundred billion yuan in the future.

In addition, there are promises on salary and options.

After taking many measures, the current Nvidia management finally gave in and expressed optimism about the acquisition.

Next, Zhiyun and NVIDIA entered into real negotiations.

At this time, Wang Hua and his colleagues in the overseas investment department became even busier. This was an acquisition with a case value of tens of billions of US dollars. Even in a giant company like Zhiyun Group, this was the first acquisition of this scale.

An acquisition of this level is extremely complex and involves many aspects.

From Zhiyun's side, there are more than a hundred people involved in this acquisition alone, all of whom are elite talents from the overseas investment department of the group headquarters and Zhiyun's US investment department.

To be honest, Wang Hua was a bit inconspicuous in the group and was only doing the most basic analytical work.

But Wang Hua still enjoys it and even feels proud of it!
As expected of Zhiyun, a company worth tens of billions was swallowed up in one gulp, without even having to pay much cash... Because according to the negotiation basis of both parties and the requirements of the other company's major shareholders and management, they would rather get Zhiyun Group's shares than cash.

Therefore, this acquisition will be completed with a small amount of cash plus a private placement of Zhiyun shares.

Although he was busy with work, Wang Hua still did not give up his private life. He would ask Elizabeth to have dinner with him every few days, and then go for a walk around the area... But most of the time they would still make love in the hotel or Elizabeth's apartment.

The main reason is that these two people are too busy. Not to mention Wang Hua, Elizabeth is interning at a large investment consulting company in Silicon Valley.

Interns have no human rights, and her female boss is a middle-aged, single, childless workaholic... So Elizabeth can only be busy all day long and get scolded from time to time.

For this reason, Elizabeth cursed her boss in front of Wang Hua every other day.

Sometimes when the two of them were exercising in the middle of the night, the female boss would send emails, and Elizabeth would reply while cursing...

"She herself has no man, and she thinks that everyone else has no man like her..."

When Wang Hua went to her company to pick her up for a date, he met her boss a few times... Tsk tsk, his aura was very scary, the kind that made people have to avoid his gaze.

Elizabeth standing next to her boss is like a kitten standing next to a tigress...it's both very awkward.

But even so, Elizabeth did not give up her work.

"I said I would stay and become Rapoo's investment advisor sooner or later."

What else can Wang Hua say? Just give spiritual support.

He also knew that Rapoo was a very strong investment consulting company in Silicon Valley. Many wealthy technology people in the Valley were their clients and entrusted their assets to them for management. At the same time, they also assisted their clients in some investments, acquisitions and the like.

The investment consultants who work there all have very high salaries... Elizabeth's female boss is said to earn more than one million dollars a year.

However, it is not easy to get into a large investment consulting company of this level, even for an intern position.

Elizabeth said that although the female boss she is following now is very demanding and strict at work, she also teaches her a lot about work and takes great care to guide her... She also said that if Elizabeth maintains her working status, she will remove her intern label.

Elizabeth is working on this lately!
So I'm very busy at work and don't have much time on weekdays...

This also leads to the situation that when two workaholics go on a date, they always think about eating something delicious and having fun, but once they get in the car, they look at each other and start to chew on each other. After chewing, they don't want to go anywhere else and often go directly to the hotel or apartment.

Young people!

----

As time goes by, the negotiations between Zhiyun Group and NVIDIA are progressing rapidly...mainly because NVIDIA's stock price continues to fall, and the other party's shareholders are anxious!

So, one day Nvidia suddenly issued an announcement, announcing that the company was about to undergo major changes and its stock trading would be suspended.

A few days later, NVIDIA and Zhiyun held a joint press conference, officially announcing that the company had reached an acquisition agreement with Zhiyun Group.

Zhiyun Group acquired NVIDIA with part cash and part stock at a premium of US$10.3 billion. NVIDIA will subsequently officially initiate the delisting process.

As soon as the news came out, it caused quite a reaction.

After all, this is a tens-billion-dollar acquisition, but the most important thing is that the acquirer is Zhiyun Group, a world-class giant enterprise.

Every move of Zhiyun Group often attracts great attention, and this acquisition of Nvidia is no exception.

The outside world generally speculates and analyzes why Zhiyun wants to acquire NVIDIA. It is generally believed that Zhiyun Group is actively developing PC business, and the core of the acquisition of NVIDIA is to fill the PC GPU field.

The announcement from Zhiyun Group also shared the same tone, mainly to supplement and integrate the PC business.

No matter what outsiders speculate, Zhiyun's acquisition of Nvidia is a foregone conclusion, and under the lobbying of public relations on both sides, the US side has officially approved this acquisition.

Not long after the beginning of 14, NVIDIA was officially acquired by Zhiyun and became a part of Zhiyun Group.

----

Even if Nvidia is acquired, Xu Shenxue is still worried about subsequent problems, such as the United States withdrawing the transaction... Don't overestimate the moral integrity of European and American countries. Once they find that there is a real need, they will do something very strange that violates business practices at any time.

Therefore, after acquiring NVIDIA, Xu Shenxue personally led the merger between the GPU business unit and NVIDIA.

Nvidia was quickly split up, and its R&D center was directly merged with the GPU project team under Zhiyun Semiconductor.

The overseas R&D center only retained one regular consumer-grade graphics card R&D project, and continued to cooperate with the GPU R&D center at the headquarters to develop various consumer-grade graphics cards for NVIDIA.

As for a large number of other projects, some were transferred to Zhiyun Semiconductor's projects, or simply cut off or merged.

At the same time, through promotions and salary increases, the original core technical backbone personnel, especially those involved in the field of AI chips, will be transferred to AI-related projects in Zhiyun's US R&D center, or simply transferred to Zhiyun's headquarters in Shenzhen.

In short, Xu Shenxue will not leave a project team involved in the AI ​​field in a research and development institution in the United States...

After this operation, NVIDIA's original R&D system was actually directly dismantled.

At the same time, there is a large amount of use and authorization of patented technologies, especially NVIDIA's core technology CUDA software. Zhiyun directly transferred this software from its subsidiary NVIDIA to its parent company Zhiyun Semiconductor.

Of course, in order to appease Nvidia's management, Xu Shenxue also promoted a large number of Nvidia's management to work in Zhiyun America or Zhiyun Semiconductor to clear away various obstacles.

In less than a month, the original NVIDIA was left with only an empty shell...even its R&D institution was gone.

Of course, in fact, a large number of Nvidia’s original R&D employees are still there, but they have all been transferred to Zhiyun Semiconductor.

Looking at the NVIDIA that he had dismembered, Xu Shenxue felt very happy!

After all this trouble, they directly killed one of their main competitors in the field of AI chips, and even turned the competitor into their own advantage.

Thinking about it makes me feel happy!

Even if the United States later discovers the importance of Nvidia and wants to withdraw the transaction, the worst that can happen is that we can just return an empty shell to them.

Xu Shenxue's purpose in acquiring Nvidia was not really for Nvidia as a company, nor was he valuing its future market value of trillions of dollars. His purpose was simple and pure from the beginning to the end.

Buy it and destroy it!
By the way, let’s get some of NVIDIA’s patented technologies, such as their core software product CUDA.

As long as it has NVIDIA's series of patent technology licenses, especially the CUDA software license, with Zhiyun Semiconductor's strong chip design capabilities, it no longer needs NVIDIA and can develop its own GPU products with powerful hardware performance and wide ecological coverage.

So when Nvidia was dismembered, Xu Shenxue felt particularly happy. This was even more exciting than if any of its subsidiaries produced a hit product and earned huge revenue.

He is more excited about destroying a future trillion-dollar company than creating a trillion-dollar company himself!

"After the split and reorganization, our group's GPU business group has become an important business group in Zhiyun Semiconductor. The entire GPU business group includes the AP architecture for mobile terminals, the OP architecture for integrated graphics cards for PC terminals, the OPA architecture for PC terminals, and the NVIDIA architecture, and finally the confidential AI project."

Fu Zhengyang, the person in charge of semiconductors, said: "It covers the graphics processor business in various fields."

"This time, we are focusing on the consumer-grade high-performance graphics processor business, especially the CUAD software ecosystem we have acquired. Our new generation of OPA graphics card series will also support this ecosystem. At the same time, NVIDIA's new graphics cards will also support our CYAP software ecosystem. The two brands and ecosystems will be connected one after another. In the future, we will try to further merge the two software."

"Although the ecosystem will be connected, we still decided to continue operating two independent graphics processor brands."

"Adopt a dual-brand, dual-structure strategy to better meet market demand."

"After all, the technical architectures of our two graphics cards are different, and the difference is quite large."

"NVIDIA's graphics card architecture is more versatile and more popular in the consumer market; our OPA graphics card architecture is derived from the mobile GPU architecture and many technologies of AI chips. It has better power consumption control and is more suitable for large-scale parallel processing. Compared with game support performance, our OPA graphics card is more suitable for use as a tool-type computing card!"

"This is why so many mining bosses purchased our graphics cards before, and it is also the main reason why a large number of professionals buy our graphics cards as workstation graphics cards and as production tools!"

Even without considering other factors, the OPA graphics cards released by Zhiyun, especially the OPA1000 graphics cards, are more suitable for large-scale parallel computing than Nvidia's existing high-end graphics cards. They are actually more suitable for both mining and model training.

To some extent, this OPA1000 is a significantly cut-down version of Zhiyun's internally kept secret AI chip... It is naturally more suitable for use as a pure computing power card.

Xu Shenxue said: "This arrangement is more appropriate, let's do it!"

Just when Xu Shenxue was splitting up Nvidia.

An AI technology team under Google also developed a new neural network algorithm based on deep learning in late January.

After they developed this new algorithm, they conducted many tests. They did not take it seriously at first because this neural network algorithm did not show much unique advantages when running on traditional CPU servers...even servers worth over a million dollars did not run well.

Until an engineer in the project team, with the attitude of having nothing to do, used the GPU on his personal PC to run this new algorithm!
A miracle happened... this runs incredibly fast.

For the same image recognition model, Google previously used an old algorithm and CPU servers, which required a thousand CPU servers to run.

This is also the main reason why Google and other companies have run into difficulties in AI research. The old algorithms are not working, and they still use CPU servers. The algorithms require too much CPU computing power, and it can be said that they have no practical value at all.

However, after using the new algorithm they developed and pairing it with a GPU server, the same image recognition task only requires three GPU servers for training.

Yes, you read it right, it’s the difference between one thousand units and three units.

After discovering this, he and his colleagues quickly built a small GPU array using graphics cards, and then conducted a large number of tests and training on the algorithm.

The result is a new model that performs amazingly well in the field of image recognition.

This discovery has greatly excited many people at Google. Although this technological breakthrough is still a bit short and far from Zhiyun's AI, it still allows them to see the dawn of AI.

Soon, Google announced that they had made great technological progress in the field of AI and demonstrated its image recognition model on site, which immediately caused a sensation in the industry... It seems that Google has also achieved great success in the field of AI.

Of course, they are not stupid and will not do anything like open source. Instead, they will follow the example of Zhiyun Group and keep the secrets.

Some basic principles can be made public, such as deep learning and neural networks, which are things that ordinary people know, but the core algorithm will not be revealed even with a single punctuation mark.

These core algorithms are basically the core secrets of some companies. If it is not for other purposes, it is impossible for them to be open sourced to you.

Everyone knows that GPU is more suitable for parallel computing. This is no secret, and some people have been doing this for a long time. But the problem is that you have to have algorithms that match each other.

Algorithms and GPUs work together to achieve great results.

Algorithms alone are useless without GPU.

But having a GPU without an algorithm is not enough.

----

After Google achieved certain breakthroughs in AI technology, it quickly found Zhiyun to purchase a batch of graphics cards. After testing, they chose to purchase the OPA1000 graphics card from Zhiyun Semiconductor.

Because Google's engineers found that Zhiyun's OPA graphics cards are more suitable for building large-scale GPU server arrays than Nvidia's graphics cards. It's not that they simply have better performance, but that they consume less power, have a better price-performance ratio, and have lower overall computing power costs.

In addition, the current OPA graphics cards also support CUDA software, so there will be no problems with subsequent development.

In this case, it is naturally better to buy OPA graphics cards to build an array.

Xu Shenxue did not refuse this. OPA graphics cards are consumer-grade graphics cards and anyone can buy them. Besides, if Google cannot buy OPA, it will turn to AMD to purchase ATI graphics cards. It's not like they can't be used even if they are a little worse.

Although ATI graphics cards have poorer gaming performance, their computing power is not bad. Many mining bosses have used AMD graphics cards for mining before.

However, since the end of last year, the OPA1000 graphics card has become the favorite of mining bosses.

If Zhiyun refuses to accept foreign orders for high-performance graphics cards, it may stimulate ATI, Intel, Qualcomm and other chip manufacturers to develop more professional computing power cards and move towards AI chips!
These companies also have GPU businesses and have a solid foundation in the GPU field. If they are allowed to start now, who knows, in a few years they might cultivate a new and powerful competitor, and Zhiyun will not be able to acquire them by then.

Therefore, it is better to sell them openly. As long as you pay, all existing graphics cards under NVIDIA, such as 780, TITAN and OPA1000, are sold openly and can be purchased at will... Zhiyun wants to use these three flagship products to directly grab the current not-so-large mining market and AI model training market as much as possible, and block the way for other manufacturers.

But... even with the GPU order from Google, it didn’t bring much revenue growth to the GPU business group.

Ten thousand graphics cards, millions of dollars in revenue.

At first glance, it seems like a lot, but in fact, for Zhiyun Group's GPU business group, this amount of revenue is nothing... The current external AI market does not bring in as much revenue as the mining market.

Mainly because the AI ​​development of companies such as Google is still limited by AI algorithms and is difficult to apply on a large scale.

Their AI project is still in the research and development stage and is mainly used for various experiments and tests rather than large-scale applications. As a result, the demand for computing power is naturally small.

At present, AI technology is relatively mature and can be applied on a large scale. In particular, only Zhiyun is using it for commercial purposes. Therefore, the company that has the greatest demand for GPU computing power is actually Zhiyun itself, not any other company.

It can be said that Zhiyun accounts for almost 95% of the current demand for GPU computing power, which is quite exaggerated... However, Zhiyun itself does not use ordinary graphics cards, but uses self-developed AI chips.

The gap between the latest Ai3000 and the consumer-grade OPA1000 is comprehensive. The computing power is about twice as big, but the video memory is four times as big. The most astonishing thing is the gap in communication bandwidth, which is as much as ten times.

Especially the difference in communication bandwidth, which is a very important data that affects model training.

After all, when a large number of graphics cards are used to form a server array, the data exchange is extremely large, and the communication bandwidth of ordinary graphics cards is too small, which leads to low training efficiency and slow speed... Of course, this slow training speed is just a comparative statement.

In fact, even the training speed of consumer graphics cards is super fast in the eyes of Google engineers... But if they saw the training speed of Zhiyun's AI chip, they would probably doubt their lives!
Zhiyun Group's so-called AI chip is actually designed to address a series of problems encountered by ordinary graphics cards when performing large-scale calculations, and then provide targeted solutions and improvements.

The communication bandwidth is too small, so I developed a new communication technology and increased the communication bandwidth by more than ten times in one go.

If the video memory is too small, then put more video memory in.

If the computing power is not enough, then put more transistors into the GPU core to increase the computing power.

Of course, special software support is also needed here. For this purpose, Zhiyun Group has also developed several special software to bring out the powerful performance of AI graphics cards.

Finally, after the hardware and hardware are integrated together, the so-called AI chip is produced... It does nothing else but run AI models.

However, Zhiyun has never announced this series of improvements or technical features of the AI ​​chip to the public.

When other AI manufacturers discover many defects and then feed them back to GPU manufacturers, they will make targeted improvements and develop a lot of compatible software. Even if everything goes well, even if we start today, it will probably take two to three years to get it working properly.

They want to catch up with Zhiyun... If we don't consider the sanctions on semiconductor equipment or consumables, then this possibility is almost non-existent.

Because while they were chasing, Zhiyun in front was also moving forward, and moving faster.

Zhiyun's AI chips have gone through three generations, and it is expected that next year it will launch the next generation of AI chips, namely AI22, based on the 3nm 4000D process.

What are they chasing after!

Previously, the company closest to Zhiyun was NVIDIA, but NVIDIA has been acquired by Zhiyun and after the acquisition, it has become an independent brand under Zhiyun and has completely transformed into the consumer graphics card field.

As for the other three companies, namely Intel, AMD and Qualcomm, the gap is too big... They couldn't even beat Nvidia in terms of consumer-grade high-performance discrete graphics cards, let alone professional-level computing cards or even higher-level AI chips.

Even though they are all GPUs, the technical differences between them are very large, and you can't just switch fields if you want to.

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As Google has also made certain breakthroughs in AI technology, other technology companies have become more anxious and started to make various efforts. Some AI startups on the market, as long as they have some achievements, may attract the attention of these big companies.

As long as there is something desirable, it is easy to get a high-priced investment or even an acquisition.

This has also led to the current AI technology field becoming a new trend, and many entrepreneurs have chosen to start their businesses in the AI ​​field.

Of course, few can succeed.

Although AI technology is very popular and it seems that there is money to be made everywhere, the technical threshold is actually very high. The algorithm alone can directly block most entrepreneurs who want to come in and make money.

From the beginning to now, the field of AI has always been a game for high-tech giants and has little to do with ordinary companies and entrepreneurs.

As for Xu Shenxue in Shenzhen, after acquiring and dismantling Nvidia, he no longer pays much attention to these things. After eliminating the threat in advance, the AI ​​field will just develop step by step.

Anyway, the basic level of semiconductors is here, and there is no way to advance too much.

After all, no matter what, the computing power of AI chips made using the current 28-nanometer process is limited.

The subsequent development of AI will be a competition of computing power.

The foundation of computing power is semiconductor technology, from the process technology of chip factories to upstream semiconductor equipment and consumables.

These are the core foundations supporting AI technology.

14 years later, Zhiyun ushered in the new year after the Spring Festival and prepared for the spring press conference.

Although Zhiyun’s spring press conference attracted a lot of attention, it was much less than the flagship phone press conference in the summer.

This year's Zhiyun Spring Conference is still the same as before, releasing new notebooks, tablets, smart watches and three major categories of products. There will also be some ecological chain products. Compared with previous years, there is nothing too outstanding.

Therefore, it seems a bit bland, but the blandness does not affect the sales of Zhiyun's terminal products.

The sales of Zhiyun's three product categories, notebooks, tablets and smart watches, have always been relatively stable. Although the sales volume is higher when new products are released and launched, it is not enough to make people line up to buy them. However, people will still buy them on normal days.

Unlike mobile phone products, especially the S series flagship phones, every release will cause a rush to buy, and sales are often very high in the first few months, and then sales will decline after a few months. When the new products are about to be launched, sales will often fall sharply...

After all, the new Zhiyun S mobile phone is about to be launched on the market. Many users who do not have such urgent demand for changing phones will often choose to wait and buy the new S mobile phone after the new model is launched.

The cyclical characteristics of mobile phone products are too obvious, resulting in this sales curve that starts high and ends low.

However, this did not affect Zhiyun's annual mobile phone sales, and Zhiyun's revenue and profits continued to grow.

At the beginning of 14, Zhiyun Group announced its fourth quarter and full year financial reports for fiscal year 13.

In its fourth-quarter financial report, the core business of Zhiyun Group, namely the communications terminal business, or the mobile phone business, had extremely strong sales of the Zhiyun S series of mobile phones, driving the growth of the entire mobile phone business. Sales increased by 25% year-on-year and revenue increased by 37%.

According to last year's financial report, Zhiyun's mobile phone sales in 13 reached million units, of which the S series, including new and old models, sold a total of million units, while the C series and A series accounted for million units of sales.

Two hundred and eighty million was only one step away from three hundred million.

The sales of other types of PC products, smart watches, tablet computers and other smart terminals are also quite good, maintaining varying growth rates. The new Bluetooth headsets are also doing well, with sales of several million.

The above-mentioned smart terminal businesses and various ecological chain businesses have brought a total revenue of more than 230 billion US dollars to Zhiyun Group.

In addition, the semiconductor business, including various chips with W series mobile phone SOC as the core, as well as chip foundry business, has generated more than US$30 billion in revenue for Zhiyun Group.

Then there are the software and Internet businesses, which also contributed more than 5 billion US dollars in revenue to Zhiyun Group.

Then the consumer electronics parts business, which includes all kinds of parts other than chips, also contributed billions of dollars in revenue.

Then financial investment also contributed more than tens of billions of dollars in revenue to Zhiyun Group... mainly from cashing out after the appreciation of shares in various startup companies invested in, interest income from various types of government bonds and other valuable bonds purchased, and value-added income, etc.

Combined with revenue from other sources, Zhiyun Group has earned a total revenue of more than 13 billion US dollars in years.

In terms of revenue, it ranks eighth in the world!
What does this revenue of 290 billion US dollars mean? The company ranked one level higher than Zhiyun is State Grid, whose revenue is more than 330 billion US dollars.

Ranked ninth is Volkswagen Group, with more than 260 billion US dollars; ranked tenth is Toyota, with about 250 billion US dollars; Six Star Electronics ranked fifteenth, with revenue of more than 180 billion US dollars; and Fruit Company ranked seventeenth, with revenue of more than 160 billion US dollars.

The above only talks about revenue, and many companies have high revenue but very low profits.

In this regard, Zhiyun Group has a huge advantage. Its profit in fiscal year 13 reached US$ billion, ranking first in the world, making it the undisputed most profitable company among global listed companies.

The second most profitable company in the world is a certain bank. With a revenue of just over 100 billion US dollars, it actually generated a profit of more than 40 billion US dollars... This made a lot of vampire bankers on Wall Street silent.

Although they are both in the financial field, the methods of the vampires on Wall Street are far inferior to those of these people... It's like the huge gap between a kid and an adult.

What is this called?
This is called ancient wisdom!

Next in third place is fruit, which generated more than 30 billion U.S. dollars in profits with more than 100 billion yuan in revenue, which is average for fruit.

Later, an American company that sold oil made a profit of more than 30 billion, and a Russian company that sold oil made a profit of more than 30 billion.

And four stars, one of the technology giants, have a profit of more than 20 billion US dollars.

The three giants in the field of smart terminals, namely Zhiyun, Fruit and Sixin, have gradually separated in size. Whether in terms of revenue or profit, there are huge differences between them.

However, even a company like Sixin that seems to be out of date is much stronger than a large number of smart terminal manufacturers behind it.

Ranked fourth among global smart terminal manufacturers is Vico Electronics. Its revenue is not disclosed to the public, but internal data shows that its full-year revenue in 13 was more than billion US dollars, but its profit was only more than billion US dollars.

There is no way. Manufacturers that focus on the mid- and low-end markets are in such an awkward situation. Their sales volume seems to be not low, with annual sales volume exceeding 200 million units, but the average selling price is too low... Not to mention the low selling price of a single unit, and as a pure assembly plant, Weiku Electronics has relatively high hardware costs and very low gross profit margins.

This means that most of the money is actually earned by hardware suppliers...well, key companies like Zhiyun Semiconductor and Huaxing Technology next door.

The situation is actually similar for a number of other domestic mobile phone manufacturers. Weiku Electronics is considered to be doing well, while the profitability of several others is even worse.

However, the huge sales volume of these domestic mobile phone manufacturers has driven the growth of Zhiyun's semiconductor business and supply chain business.

Therefore, they also contributed to Zhiyun Group's revenue of nearly 300 billion US dollars and profit of more than 50 billion US dollars.

Zhiyun’s achievements in the past 13 years, including sales, revenue, profit and other data, have been extremely explosive.

But after Zhiyun released its financial report, the stock price did not rise, but fell again...

Because the financial report and other data released by Zhiyun had some gaps with the previous estimates of various analysis agencies and investors, it failed to meet their expectations.

The revenue estimates are similar, but the profit estimates are very different. The outside world originally estimated that it would reach more than 53 billion US dollars, but the result was only 51 billion US dollars.

This means that although Zhiyun Group’s smart terminal business is still very profitable, other businesses are beginning to drag down Zhiyun’s overall profit margin.

In particular, Zhiyun's semiconductor manufacturing business, which is extremely hated by many investors, is simply the culprit that drags down Zhiyun's profits.

This business requires billions or even tens of billions of dollars in investment, but the chip foundry revenue is only a few billion dollars...

The input and output are totally disproportionate.

At the same time, this year Zhiyun Microelectronics will continue to compete in costly process competition with chip factories such as TSMC, Quadcore, UMC, GlobalFoundries, and Intel, requiring huge capital investment, which may further drag down Zhiyun's overall profitability in the semiconductor manufacturing business.

With the continuous advancement of technology and the doubling of investment, the current semiconductor manufacturing field has become a bottomless pit that swallows up money. These leading chip manufacturers are gritting their teeth and holding on... until others can't keep up, or simply give up.

Then we can usher in the spring of winner-takes-all!
But can Zhiyun Microelectronics win? Many people remain pessimistic.

In addition, many investors do not understand other businesses, such as the PC chip business in Zhiyun Semiconductor... When Zhiyun makes mobile phones, at most you are a smart terminal company. In the PC business, it would be good to make money by assembling ultra-thin business notebooks. As a result, you actually started to make things like CPUs and GPUs yourself.

It also spent a considerable amount of money to acquire Nvidia.

These operations are actually not understood by the capital market.

Investors think that Xu Shenxue likes to mess around too much and spends money inappropriately. The large investments he is making in semiconductor manufacturing and PC businesses may continue to drag down Zhiyun Group's overall profits... That's a huge hole worth tens of billions of dollars.

So in the end, investors voted with their money. Zhiyun's market value rose slightly before the financial report was released, reaching more than 630 billion yuan. However, it plummeted by more than 20 billion yuan after the financial report was released, leaving only more than 610 billion US dollars.

So much so that many so-called domestic news media were shouting that Zhiyun plummeted by more than 160 billion overnight... When the unit of US dollars was converted into Chinese yuan, the number suddenly became larger.

Just reading the title is scary!
People who didn’t know would think Zhiyun was doomed.

As a result, normal people would realize that, if calculated in Chinese yuan, Zhiyun's market value has dropped from more than 4.4 trillion yuan to more than 4.2 trillion yuan... It doesn't seem like it has dropped much.

Zhiyun is too big, so a slight fluctuation of a few points means tens of billions of US dollars, and when converted into Chinese yuan, it means one or two hundred billion, so it is quite normal.

Without mentioning all the external troubles, some investors, especially those who are optimistic about Zhiyun Group, are also helpless when seeing this wave of decline.

In the past year or so, Zhiyun Group's market value has fluctuated around US$600 billion many times, and has reached the US$600 billion mark as many as four times.

It failed to stand firm three times before, but at the end of 13 it once again reached the billion mark and continued to rise, finally gaining a foothold.

However, many people thought that it would continue to rise, but it ended up falling by more than 20 billion US dollars.

Of course, it’s not just Zhiyun’s stock price that’s falling, Fruit and Sixing’s are also falling…

The performance of these three high-tech giants in the stock market has not been very good in the past year, with huge fluctuations.

The reason for their poor performance does not mean that their business is really failing, for example, the sales volume of core products has dropped abnormally sharply.

If that were the case, their stock prices would have been cut in half long ago… The last high-tech giant whose core product plummeted was Ounoya.

Investors are often ruthless to such companies, and it is normal for them to cut their stock prices in half again and again...

Today, the stock prices of the three major technology giants in the smart terminal field have fluctuated and fallen slightly. The core factor is that investors have too high expectations of them.

Especially before the financial report is released, some optimistic investors tend to overestimate the company's various sales, revenue, profit and other data.

This overvaluation will naturally lead to an overvaluation of the stock price, which will often lead to the stock price being pushed up during this period of time.

As a result, when the financial report was released, the data from all aspects failed to meet the high estimates of these optimists, and the stock price naturally fell back to where it should be.

A similar situation also occurs before the launch of important products. Before Zhiyun, Fruit, and Sixin released their flagship phones in the past one or two years, their stock prices generally rose, but they immediately fell after the launch conference.

This is almost becoming a fixed routine!
(End of this chapter)