WSJ What’s News - China’s Huawei Develops New AI Chip to Rival Nvidia

Episode Date: April 28, 2025

A.M. Edition for April 28. Huawei is developing a new AI chip that aims to rival high-end offerings from U.S. semiconductor giant Nvidia. WSJ tech reporter Liza Lin says that although Huawei's Ascend 910D chip is still in the early stages of development, it shows the resilience of China’s semiconductor industry. Plus, Canadians head to the polls to decide the country’s next leader amidst economic turbulence and outside pressure from President Trump over trade and security. And elite universities form a private collective to push back against the White House. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

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Conditions apply to all benefits. Visit pcfinancial.ca for details. China's Huawei develops a new AI chip designed to go toe-to-toe with Nvidia. Plus, Canadians head to the polls in an election dominated by threats from Washington and how one Ohio City population, 265,000, became America's housing goldmine. With home prices at sky-high levels in many markets, relatively low-priced pockets of America like Toledo are seeing a lot more elevated interest. It is one of the sort of hidden gems of housing affordability.

It's Monday, April 28th. I'm Luke Vargas for The Wall Street Journal and here is the AM edition of What's News, the top headlines and business stories moving your world today. It's almost time for the culmination of earnings season as Microsoft, Meta, Amazon, and Apple prepare to report quarterly results in the coming days. Along with Alphabet, Nvidia, and Tesla, those magnificent seven tech stocks were largely responsible for lifting stocks out of the 2022 bear market, but currently they find themselves in a very different situation.

So far this year, they've collectively shed two and a half trillion dollars in market value, with each falling more than 6 percent, and their earnings dominance is expected to diminish. According to analysts pulled by Factset, the Mag-7 are on pace for just 16 percent profit growth this year, down from about 37 last year. Microsoft and Meta's results are due on Wednesday, with Amazon and Apple following on Thursday. Meanwhile, just months after the emergence of Chinese AI model DeepSeek dented some investors' faith in the supremacy of US tech, we exclusively report that China's Huawei is developing a new AI chip that aims to rival high-end offerings from US semiconductor giant NVIDIA.

And here with more from Singapore is Journal tech reporter Lisa Lin. Lisa, this chip, the Ascend 910D we should note is still in the early stages of development. A first batch of the processor isn't even said to be delivered until late next month at the earliest. However, I gather the significance here is namely that there's a perceived market opening thanks to actions by Washington and that there's a Chinese company making very concrete plans to try to capitalize on this moment. Yeah, you're right on both counts, Luke. Although I would point out there's a third

dimension to this and it would be good to remind listeners on the background of Huawei. This Chinese tech company started out as a cell phone and telecom equipment maker, and Washington basically forced their hand and forced them to go all in with designing and producing chips when they cut Huawei off advanced American technology five years ago. They were once big buyers of Qualcomm, Nvidia, Intel chips, and now they have to design, make their own, and now they're even selling it. And it's a huge addressable market. I mean, the timing really coincides with when US policymakers have made

their latest move to try and cut China off the latest advanced US chips. The most recent one being the ban of Nvidia's H20 chips into China. The H20 is not seen as the most top end chip from Nvidia, but it was the best chip available for sale by an American GPU or AI chip maker into the country, and now these chips have been cut off. So now you have more willing buyers in China for Huawei chips than there were before. The road ahead though, not certain, far from it, I imagine.

Tech promises are not the same as actually delivering on them. What challenges does Huawei have to still overcome to capitalize on this? The first big one is production. Huawei can design such a fantastic chip, but realistically can they produce it in the mass quantities needed for both for themselves, for internal use and for external sales? That is a big question. Huawei has been cut off from the world's biggest and recognized as the best foundry, TSMC, and the Chinese equivalent of that SMIC is far from as efficient in terms of production as TSMC is. The next is that Huawei's chip design and chip making really still lags Nvidia, and we know

this because sources tell us that in order to produce the 910D, what Huawei did was they used packaging methods to pack what is the equivalent of three to four existing mature chips together to make them more powerful. However, the eventual result is such a chip is a lot more power intensive and power hungry. So you can tell that in order for Huawei to catch up with like Western peers, such as Nvidia, they've had to overcompensate. I think one of my main takeaways from this story and from talking to people in China's chip space is not to get caught up in the fact that Huawei has had this innovation, but to see bigger picture and realize that the Chinese chip industry is now at the point where

within five to ten years, it could become a formidable global force to its American rivals. It has got the right ecosystem and the supply chain to keep innovating in that direction. That was Journal Tech reporter Lisa Lin. And there's a lot besides tech earnings that investors will be watching this week. Updates from Coca-Cola, General Motors, Pfizer, UPS, Starbucks, and Visa are due tomorrow. Wednesday we'll bring an update on the Fed's preferred inflation gauge, along with an initial reading of U.S. first quarter GDP.

Eli Lilly, MasterCard, and McDonald's will report earnings Thursday. The same day we'll do a rate decision from the Bank of Japan and a pair of US manufacturing PMIs. Friday we'll see quarterly updates from oil majors Chevron and Exxon, along with the first monthly US jobs report since President Trump's Liberation Day tariff announcements and the scheduled end of the de minimis exemption for shipping lower-value goods to the US from China, which had boosted the fortunes of Xi'an and Temu in recent years. And as if the week wasn't busy enough, we've had a slew of M&A announcements this morning.

Shares of Deliveroo hit a three-year high in London after the food delivery company said it received a more than $3.5 billion takeover approach from DoorDash. Meanwhile, Airbus is taking over key U.S. and European assets from supplier Spirit AeroSystems, which rival Boeing agreed to buy last year. The carve-out secures crucial parts for Airbus' commercial aircrafts and comes ahead of this week's self-imposed deadline for Boeing to finalize its takeover of spirit. And we've also had multi-billion dollar deals involving German pharmaceutical company Merck which is buying Springworks Therapeutics and between Spanish banks Mediobanca and Banca

Generali. Check out wsj.com for more on all of those deals and how investors are reacting. Coming up, Canada heads to the polls in what's set to be a major election upset and a referendum on ties with America, and how buyers are being priced out of the red-hot Midwest housing market. We've got those stories and more after the break. Talking about guns with others might not always feel comfortable but it could save a life

here's a way to start a conversation your family is going over to your neighbors home for dinner for the first time how would you ask if there are any unlocked guns in the home hey hey we're so excited for tonight before we come over though may I ask if there are any unlocked guns in your home our guns are stored securely locked in a safe election today to decide who will lead the country amidst the economic uncertainty it faces and negotiate with President Trump over trade and security.

Just a few months ago, the Conservative Party under leader Pierre Poliev held a more than 20-point polling lead over the governing liberals. But that is until Prime Minister Justin Trudeau was replaced by former Central Bank Governor Mark Carney and President Trump announced tariffs. And now the liberals are polling with a three-point lead over the conservatives. We need to fight Trump's tariffs with counter tariffs of our own that cause maximum damage in the United States with minimum impact here. Poliev, meanwhile, a career politician, has tried to make the election about inflation

and housing prices that are among the highest in the world, which he blames on Trudeau's leadership over the last decade. Mark Carney's plan is to do exactly what Trudeau did on steroids. More spending, more taxes, more soft on crime. We can't afford four more years of the Liberals. We need a change. Over the weekend, both leaders, along with the heads of Canada's other political parties,

changed their campaign schedules in light of Saturday's attack in Vancouver, where 11 people were killed and at least 20 injured after a man drove through a crowd at a street festival, according to local police, who said the incident wasn't terrorism. The suspect was apprehended by bystanders at the scene and charged with eight counts of second-degree murder yesterday, though prosecutors say more charges are possible. Israel's government is under pressure to lift an aid ban on Gaza, with humanitarian supplies there running out after a blockade that's lasted almost two months. Officials are now debating the best way to get supplies back into the territory without strengthening Hamas.

The military reportedly favors working with international organizations that have distributed aid throughout the war. Though some far-right officials want Israel to play a greater role in distributing the aid itself, not shying away from perceptions that Israel is an occupying force. We are exclusively reporting that the leaders of some of the nation's top universities have assembled a private collective to counter the Trump administration's attack on academic independence across higher education. The group, which includes about ten schools from IVs and leading

private research universities, have discussed red lines they won't cross in negotiations, including autonomy over admissions, hiring, and what they teach and how it's taught. According to a source familiar with the government task force that's issued funding threats to universities, the Trump administration has been worried that schools would team up in resistance because it's harder to negotiate with the united front. The White House didn't respond Sunday to request for comment. And the struggle to find a cheap house is transforming America's heartland from one of the last places for lower-priced homes into a battlefield pitting Wall Street landlords

against traditional buyers. Toledo, Ohio is one of those places where housing reporter Rebecca Pichotto says that competition for homes is more cutthroat than ever as interest in the city peaks. Rebecca Pichotto, Housing Reporter, Toledo, Ohio It's not just from traditional home buyers. It's also out of state real estate investors who may never have set foot in Toledo, but they see these kinds of rare low priced markets as gold mines for single family rental businesses and house flipping operations and things like that. So as a result, the overall share of Toledo single family home purchases by investors, it doubled from 15% in February 2018 to 30% this February.

That's according to the data firm Kotality, formerly known as CoreLogic. Nat. And Rebecca told us that Toledo is a case study for what's happening in the broader Midwest. Rebecca Bollingham As home prices have risen, people have seen the Midwest as kind of the last factions of housing affordability in America. And given that, it is causing investors and buyers to flock there in a way that's causing home values and even rent prices to rapidly appreciate. So rent growth has

steadily ticked upwards in the broader Midwest as it's declined nationally. So the story of Toledo is sort of the story of the Midwest housing market right now. And that's it for What's News for this Monday morning. Today's show was produced by Kate Bulevent and Daniel Bach. Our supervising producer is Sandra Kilhoff and I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show. And until then, thanks for listening.