Rebirth 08: Rise from copycat phones

Chapter 577 I bet Xu Shenxue's money-burning speed can't keep up with his money-making speed
After Zhiyun Group officially announced strategic cooperation in the field of artificial intelligence with Google and other American companies, and secured a huge order worth 50 billion US dollars.

The APO6000 graphics card quickly became the talk of the world, with numerous tech media outlets, independent media personalities, and even bloggers outside the industry publishing various opinions and a mix of true and false information.

One American tech blogger detailed the APO6000 graphics card in a column, and his information was somewhat credible, as he claimed to have obtained it firsthand from an insider in a delegation from a well-known American company.

The staff members in these delegations had seen the APO6000 graphics card and naturally knew some of its features.

However, the actual number of people who have access to the APO6000 graphics card in the delegation are mostly senior management and core technology executives from various companies... They are too busy to pay attention to these so-called bloggers.

These bloggers only have access to ordinary employees on the periphery, and these ordinary employees have very limited information, which is not necessarily accurate.

Therefore, the various sources of information are a mix of truth and falsehood, making it even more confusing for outsiders... Everyone knows that the APO6000 graphics card is more powerful, but no one knows exactly why it is so powerful or what makes it so powerful.

Subsequently, many media outlets contacted Zhiyun Group to make various inquiries!
Even many investors are paying close attention and asking questions... For investors, the performance of the APO6000 also determines their next investment direction, so they are also very concerned about the APO6000.

After all, the computing chip business has become one of the core businesses of Zhiyun Group, and it is also the business with the highest gross profit margin. The profits it contributes to the group have almost caught up with those of the smart terminal business, making it a new cash cow for Zhiyun Group.

Among a range of computing chip businesses, the APO series graphics cards are undoubtedly the most important computing chip.

The performance of the APO6000 will directly impact the revenue and profits of the Zhuyun Group in the next stage.

These investors, despite their lack of knowledge about chips and artificial intelligence, are still very interested in the APO6000 graphics card.

In response to the outside world's attention to the APO6000 graphics card, especially the extreme attention from investors... and considering that although the APO6000 graphics card has not yet been released, it has actually begun to accept orders from various strategic customers.

While several top American high-tech companies came as a group to make purchases, several domestic high-tech companies were also simultaneously in contact with Zhiyun Group to discuss orders for APO6000!
At this point, there was no need to hide anything anymore. Zhuyun Group simply held a special press conference to officially release its new generation of data center GPUs: APO6000!

Xu Shenxue did not participate in the press conference; instead, Fu Zhengyang, Senior Vice President of Zhiyun Group and General Manager of Zhiyun Semiconductor Technology Co., Ltd., hosted the press conference.

At the very beginning of the press conference, Fu Zhengyang set the tone: "The new generation APO6000 has three to seven times the performance of the APO5000 in all aspects!"

"The APO6000 adopts a brand-new GPU core architecture, significantly increasing the number of computing cores to 23,000!"

"It also adopts the N5S process, a deeply customized version of Zhiyun Microelectronics' five-nanometer process. Compared with the APO5000 GPU core, the transistor density is increased by two times, reaching 200 million transistors per square millimeter, and the total number of transistors reaches an astonishing 100 billion."

The previous APO5000 graphics card used Zhiyun Microelectronics' N72 process, which is Zhiyun Microelectronics' second-generation seven-nanometer process, with approximately one hundred million transistors per square millimeter.

The APO5000 GPU core was designed to accommodate tens of billions of transistors to achieve sufficient performance, resulting in a relatively large core size. This led to higher costs and power consumption. Zhuyun Group initially aimed for ultra-high performance, but this resulted in the APO5000 graphics card's high power consumption.

The power consumption per unit of computing power is actually not that good!

The GPU core area of ​​the APO6000 is actually smaller than that of the APO5000 graphics card... It's a bit smaller... It's not that we didn't want to make it bigger, but rather it's due to the technical difficulty and manufacturing cost control, as well as the need to reduce power consumption.

Creating chips with larger areas and more transistors is actually very difficult.

As for Zhiyun Microelectronics' N5S process, it is actually a process that Zhiyun Microelectronics optimized specifically for the manufacture of computing chips based on its five-nanometer process... The technical difficulty has not changed much. The main change is to some process design to make it more suitable for manufacturing computing chips... The main purpose is to reduce power consumption.

The purpose of reducing GPU size and using deeply optimized processes is, frankly speaking, to save on electricity costs...

These large computing chips consume too much power, so how to reduce power consumption without losing computing power and thus save electricity is a very important area... Even if the power consumption per unit of computing power is reduced by 5% or 10%, that is a huge number in the entire data center!

After all, when large enterprises build data center arrays, they often use tens of thousands of APO graphics cards in a network, which consumes an astonishing amount of power...

These days, playing with artificial intelligence requires massive amounts of electricity from data centers... This is also why many small and medium-sized countries can't play with artificial intelligence—their power supply is inadequate.

To exaggerate a bit, for most countries, even if Xu Shenxue gave them millions of APO5000 graphics cards for free, they still wouldn't be able to run them... because they wouldn't have enough power!
This is why the APO6000 graphics card places great emphasis on controlling power consumption per unit of computing power in its design and manufacturing processes... This directly relates to computing power costs!
At the press conference, Fu Zhengyang also introduced the new generation of high-bandwidth memory used in the APO6000 graphics card: HBM3X!

This is Zhiyun Storage, a subsidiary of Zhiyun Group. It is a high-bandwidth memory that has been optimized based on the third-generation high-bandwidth memory HBM3. In terms of process node, it is still a third-generation high-bandwidth memory, but the data transfer speed is faster, about 30% faster, and the power consumption is lower.

These designs are also intended to reduce the cost per unit of computing power!
In addition to the technological advancements at the hardware level, the APO6000 graphics card also features innovations in its supporting communication interconnection technology, significantly improving the bidirectional transmission speed of a single GPU.

It also increased the data throughput of the entire APO6000 server!
This communication and interconnection technology is actually even more important than performance improvements at the hardware level alone...

After all, even the most powerful GPU and high-bandwidth memory need to be utilized to their full potential... No matter how powerful a single APO6000 graphics card is, it's useless if the communication and interconnection technology can't keep up.

Because data centers consist of tens of thousands of APO graphics cards... when training or running artificial intelligence, their data throughput is extremely large.

Improving the data throughput of the entire data center in this way has become a very critical core technology... and this is also the core technological advantage of Zhiyun Group, which is far superior to AMD.

This is why consumer-grade high-end graphics cards, such as the X-series graphics cards from Zhiyun Semiconductor, although they appear to have very good hardware performance on the surface, may at first glance be usable as low-end computing cards.

But in reality, apart from personal hobbyists, nobody uses this thing to train artificial intelligence or run GTAI!
Because the video memory communication bandwidth of these devices is insufficient, the bidirectional transmission speed of the GPU is also insufficient, and if multiple cards are integrated into a server, the data throughput is even more insufficient... a whole host of shortcomings result in the fact that the X-series graphics cards, which seem to have excellent performance, are actually unable to form a large-scale cluster for efficient computing.

It features a top-tier GPU built on the N5S process, with over 100 billion transistors and more than 20,000 computing cores, along with the next-generation HBM3X high-bandwidth memory and a new generation of communication interconnect technology!
All of these together make up the APO6000 graphics card!

The next-generation data center GPU developed by Zhiyun Group and its subsidiaries has achieved performance levels that are 3.5 to 7 times that of the APO5000.

Of course, the price is also very high!
Xu Shenxue has always been extremely unscrupulous when selling computing chips... His pricing is never based on cost and profit, but on the cost of computing power.

The latest generation APO6000 graphics card, the 160GB version for personal use only, is not for sale to external parties!

The version sold to customers is the 80GB version with the APO6000 graphics card.

A 120GB high-capacity version is also available... but while this version offers better performance, it is more expensive and has higher computing power costs!
It depends on the customer's choice. If you want the best value for money, choose the 80GB version. If you just want performance and don't care about the cost, you can choose the 120GB version.

As for the price, the price announced by Zhiyun Group is also quite shocking!
The APO6000/80GB version is priced at 350,000.

The APO6000/120GB version is priced at an astonishing 480,000!
This price is actually the domestic price. If it is purchased by an overseas company and the other country adds additional tariffs, then Zhiyun will not care.

However, these days, no country imposes tariffs on Zhiyun Group's APO graphics cards; they're basically tax-free...

Even in India, a country known for its high tariffs, they have created a special tariff exemption clause for APO graphics cards.

These top-tier data center GPUs are in high demand and limited production capacity; some countries' companies, lacking the resources, can't even secure a single unit...

The exorbitant price of the Zhiyun APO6000 has left many business leaders feeling disheartened... It's just too damn expensive.

It's just a graphics card, and you're selling it for three or four hundred thousand? That's insane!
But there's no use being upset; APO graphics cards from Zhiyun Group have always been incredibly expensive...

The current top-selling APO5000 graphics card is priced at around 230,000 RMB by Zhiyun for its strategic partners. This price has not been reduced since its release!
Moreover, this is the price for normal queued orders. If your company is not very strong but you want to get the goods quickly, you can also choose to pay a premium. The closer the delivery time is, the more expensive the price will be, and the price may reach 270,000 to 280,000.

The current generation APO6000 starts at 350,000 NTD, which is actually quite affordable...

In addition, Zhiyun Group officially launched the APO6000 graphics card and announced that it was accepting orders, with large-scale deliveries expected to begin in December.

They also announced that they will officially stop accepting new orders for APO5000 graphics cards. Supply of APO5000 graphics cards will cease once existing orders are fulfilled.

However, even with these existing orders, production will likely continue for about a year. There are too many accumulated orders for the APO5000 graphics card, and the supply and demand have been announced for a long time, with order backlogs exceeding one year.

As for the APO5000 graphics card, it will be completely discontinued one year from now!

Despite its large-scale expansion of 3D packaging technology capacity, Zhuyun Microelectronics, a subsidiary of Zhuyun Group, faces challenges due to the time required for capacity expansion and the rapid growth in usage.

It's not just that data center GPUs are in high demand; the key issue is that Zhiyun Group also develops its own virtual devices, which require advanced packaging technology.

In the next two to three years, Zhuyun Group's advanced packaging technologies, whether 3D or 2.5D, will be in very short supply...

之前智云集团因为3D先进封装工艺不足，都不得不停产APO4600显卡，搞出来了一个使用2.5D封装工艺的APO4600S。    同时又把原来使用2.5D封装工艺的APO4500显卡给停产了，转而生产采用成熟BGA封装的APO4500M。

Therefore, in the future, it will be inevitable to use the limited advanced 3D packaging technology to produce the more advanced, higher-priced, and more profitable APO6000 graphics cards... As for the APO5000 graphics cards, which also use 3D packaging technology, apart from reserving some production capacity for virtual device production, they will be completely discontinued.

Meanwhile, Zhiyun Semiconductor is also designing a new version of APO5000, using a slightly outdated but relatively more productive 2.5D packaging process to create a slightly less powerful APO5000S graphics card for use in the production of virtual devices!

Barring any unforeseen circumstances, the APO5000S is expected to be launched by the end of the year and will be integrated into the next generation of virtualization devices!
It will also use the same APO5000 GPU core, paired with the more mature and outdated HBM2 memory, and use BGA packaging to produce the APO5000M graphics card with slightly worse performance.

Currently, Zhuyun Group has a general classification of its advanced packaging technology production capacity.

The most advanced 3D packaging technology is mainly used to produce top-of-the-line data center GPUs, primarily for internal use and supply to major enterprise customers for artificial intelligence training and operation, such as the APO6000 graphics card... Of course, the APO6000 graphics card can also be used in high-end virtual equipment, but the usage is very small and will not affect the overall situation.

The 2.5D packaging process, which is more mature but relatively outdated, is also cheaper. It is mainly used in the next-tier APO-S series graphics cards to meet the needs of some small and medium-sized enterprises, while also being used on a large scale in their own mid-range virtual equipment field.

As for BGA technology, it is mainly used to produce consumer-grade graphics cards, such as X-series gaming graphics cards and some professional graphics cards. In the short term, it will also be used to mass-produce inexpensive entry-level APO-M series graphics cards, mainly for low-end, high-volume virtualization devices.

Therefore, next year, the APO5000 graphics card will present a rather peculiar situation, with three models: APO5000, APO5000S, and APO5000M.

The full-power version of the original APO5000, with 80GB of HBM3 video memory and 3D packaging technology.

The APO5000S is a low-end version with 80GB of HBM3 memory and 2.5D packaging technology.

APO5000M entry-level version, HBM2 memory, BGA package!

However, all three models of graphics cards actually use the same GPU core...

The reason for this phenomenon is that in the current computing chip field, the scarce resource is not GPU production capacity... In fact, Zhiyun Microelectronics has a considerable production capacity of 7nm logic chips, currently producing 100,000 wafers per month. This not only meets its own needs but has also led to a large number of foundry orders being placed with external suppliers... Because of its excellent cost-performance ratio and superior process performance, it has snatched away a large number of foundry orders from TSMC and Samsung Semiconductor!

So much so that some outsiders say that Zhiyun Microelectronics is engaging in a price war in the 7nm process field... Their second-generation 7nm process has the best performance to begin with, but the price is indeed comparable to the other two companies, while the production capacity is sufficient and there is no need to wait in line for a long time, which immediately makes the cost performance stand out.

Besides Apple and Qualcomm, who firmly chose TSMC and Samsung respectively, many other foreign, and even American, chip design companies have successively adopted Zhiyun Microelectronics' 7-nanometer process for manufacturing!

After all, nobody turns down money!

Even Zhiyun Microelectronics' 5nm process capacity isn't exactly scarce... The current existing capacity is 50,000 wafers, and the S1103 chip can't even use up that much capacity... Because starting this year, the S1103 chip will only be used in the MAX series phones, while the S20 standard version, Pro, and A series phones will use the S1003B chip used in last year's high-end phones!

The S1003 chip in last year's S19 series phones was produced using two processes simultaneously because the production capacity of the second-generation 7nm process was limited in the early stages! The first-generation 7nm process S1003A was used in the S19 standard version and Pro, and the A19 phone also used this chip.

The second-generation 7nm process produces the S1003B chip, which is only used in the S19 Max and S19 Max Pro.

This year's S20 series phones will also continue to use two chip layouts to differentiate performance and cost, while also reducing the huge demand for advanced process capacity.

This is also why the APO6000 graphics card started production in the summer this year. Because the S1103 chip is used in relatively small quantities, the production capacity of the 5nm process can be allocated.

The official release of the APO6000 graphics card by Zhiyun Group has sparked considerable discussion.

Many media outlets and ordinary netizens are not concerned about performance... anyway, most of them don't understand it or care about it; what they care about is the price!
80GB costs 350,000, and 120GB costs a whopping 480,000! These prices are outrageous!
Many media outlets, especially independent media, focus their narratives around this price in order to attract traffic.

Many headlines are similar to this:

"How can the APO6000 graphics card be sold for 480,000?"

"The APO6000 graphics card is priced at over 480,000 yuan!"

Is the APO6000 worth 480,000?

Why are major high-tech giants willing to pay an exorbitant price of 480,000 yuan for a graphics card?

In reality... most companies purchase the APO6000 graphics card, not the 120GB version, but the 80GB version that costs 350,000!

The 80GB version offers better value for money, but the delivery time is a bit longer.

The 120GB version has higher performance, but the price-performance ratio is not good... However, because the price-performance ratio is not good, the order volume is small, so the delivery time is also shorter.

Ordinary discussions outside the industry are meaningless, but the actions within the investment community truly demonstrate the immense power of the APO6000 graphics card!
Zhuyun Group just held a press conference, and before the conference had even officially ended, Zhuyun Group's stock price had already started to rise.

By the time the press conference ended, the stock price had already risen by three points!
And the upward trend has not ended. As Zhuyun Group continues to release relevant information and numerous reports from various analytical institutions are published, its stock price continues to rise.

The following day, Zhiyun Group officially announced that it had reached strategic cooperation agreements with leading domestic high-tech companies such as Yihai Technology and Tencent to conduct in-depth cooperation in the field of artificial intelligence, with a cooperation amount exceeding 20 billion US dollars.

After the announcement, the stock price rose a few points.

Subsequently, Zhiyun Group announced cooperation agreements with several strategic clients in Europe, Japan, South Korea, and other countries.

Besides the major announcements made proactively by Zhiyun Group, some companies also make their own announcements... After all, many companies don't have large orders, so Zhiyun Group doesn't promote them. However, for the companies themselves, these are indeed very important strategic deployments in the field of artificial intelligence, and they want to boast about them.

As a result, many companies have started to announce that they have reached a strategic cooperation with Zhiyun Group, purchased a certain number of APO6000 graphics cards, and are actively developing and cultivating the field of artificial intelligence, etc.
After collecting and compiling information, some statistical agencies found that although the APO6000 graphics card had just been released, the number of orders was quite staggering, even more so than the previous generation APO5000 graphics card!
According to analysts, APO6000 orders have already exceeded two million units... and the number of orders continues to increase.

There is only one factor preventing Zhiyun Group from making money right now: production capacity!

Once production capacity is up and running, the production line for the APO6000 graphics card from Zhiyun Group will be a super money-printing machine!
Everyone knows that Zhiyun Group's APO graphics cards have extremely high premiums, with gross profit margins consistently above 80%, and the advanced models even reaching over 90%!

The cost of the APO6000 graphics card is actually quite easy to estimate. The GPU core costs at most 3,000 yuan, the HBM3X costs a little more, but for 80GB, it is estimated that it will not exceed 20,000 yuan. The 3D packaging cost is around 5,000 to 6,000 yuan. Adding other miscellaneous material costs, the highest estimate is 1,000 yuan.

The total cost of all the hardware is at most 30,000 yuan... but its selling price is 350,000 yuan!

A gross profit margin exceeding 90% is a certainty!

Two million APO6000 graphics cards, at an official price of 350,000 each, would generate 700 billion in sales revenue. With a gross profit margin of 90%, that would amount to 630 billion in gross profit!
This earning power is even more outrageous than a money printing machine!

With such an exaggerated ability to make money, it's easy to understand why Zhuyun Group invests so heavily in the semiconductor field, and can afford to do so... They really make a lot of money!
The successful launch of APO6000 and the huge orders once again demonstrated to investors the formidable earning power of Zhuyun Group... At this point, many investors got carried away and overlooked the huge investments Zhuyun Group makes in R&D and the semiconductor field every year.

We're not even considering the price-to-earnings ratio anymore.

Huge R&D costs and semiconductor investment costs? They seem high, but Zhiyun is so profitable. Even if Xu Shenxue is a big spender, he can't possibly spend all the profits.
To put it bluntly, as long as Xu Shenxue leaves a little profit between his fingers, it's enough for everyone to have a full meal.

Forget about manufacturing companies with P/E ratios of 20... Zhuyun Group isn't a traditional high-tech manufacturing company; it's a super money-printing machine that monopolizes the top-tier market!
Although Zhiyun Group currently only makes about $200 billion in profit a year, a group of investors are betting that Zhiyun Group will earn $300 billion next year and $400 billion the year after!
If investors calculate based on its profits of $400 billion a few years from now, and then give it a price-to-earnings ratio of 20... it's not unreasonable to estimate its market value at $8 trillion, right?
The market value of Zhiyun Group is less than 50,000 now. What are you hesitating for?
Sell ​​it...

Then a group of analysis firms confidently produced various reports saying that Zhiyun Group's profits would inevitably continue to grow significantly in the next few years... Not only are computing chips profitable, but Zhiyun Group also has a robotics business and a virtual business, both of which have great future prospects!
Profits of $300 billion are estimated to be achieved next year, and $400 billion the year after is highly probable. It wouldn't be surprising if profits reached $500 billion in three to five years...

Although Xu Shenxue spends money very quickly, even if he just takes money and burns it for fun, he can't burn several hundred billion dollars a year... There's no way he could burn all that money!
Therefore, many investors are betting that Xu Shenxue's cash-burning speed will not outpace the money-making speed of Zhiyun Group!

As a result, all investment analysis institutions gave Zhiyun Group's stock an S+ rating and unanimously recommended buying it!

In addition, due to quantitative easing, some traditional industries have continued to decline in global capital markets recently, and a large amount of funds need a new investment outlet.

Due to a combination of factors, the stock price of Zhuyun Group also soared...

In July, the value hovered around four trillion US dollars, but in just half a month it rose to more than five trillion US dollars.

By August, Zhuyun Group's stock price had already risen to six trillion US dollars.

Moreover, this upward trend has not stopped and is still continuing to rise!

(End of this chapter)