Curious what the fundamental limit on Huawei's capacity is. China has shown if nothing else they know how to scale when they want to. If it came down to just building more of what they know how to do, it would be happening. Is there more to it?
Their yields on high performance chips that could do training is really bad, and they aren’t getting more of the outdated ASML machines that they could use to scale up even with bad yields. It will still take China a few years or a decade to build out the tech needed to fab high performance chips economically on their own.
They can already make chips economically. Yields are worse than TSCM but good enough since they no longer need to pay the "Qualcomm tax". Huawei's phones are profitable. The issue is rather that Chinese capacity comes from a low quantity, and scaling capacity while simultaneously indigineousizing parts takes time — years. Foreign capacity was too good and too cheap so they never succeeded in scaling capacity, because the demand for Chinese fabs wasn't there. Now the demand for domestic capacity is there and they're scaling like crazy, like 100-200% growth per year. But demand still far outpaces capacity. Fabs are hard to build. You need many more years of 200% growth to even approach the demand.
And yes, I made use of emdash. It's a legit grammar tool. Sue me.
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Huawei chips need advanced 3d packaging in order to keep up. Since the process is too complex the yield is still bad.
Not to mention there is a lot of demand from various factors, not deepseek only. Huawei itself is a major consumer.