Z.ai shares jump 8% after unveiling new AI model powered solely by domestic chips
Chinese AI firm announces new model running entirely on homegrown semiconductors
1Breakthrough in domestic chip-powered AI
Chinese AI company Z.ai launched its GLM-5.3-Flash model, which operates entirely on domestically produced chips. The model was released on August 20 under the codename Ox Alpha, utilizing 100,000 China-made chips. Ranking 10th on the Artificial Analysis Intelligence Index, this low-cost version has become the most used model on the global OpenRouter platform in the past week.
2Stock market surge
Z.ai's Hong Kong-listed shares rose more than 8% following the announcement of its new model. Since its January IPO, the company's shares have skyrocketed over 800%. Rival firm MiniMax saw only a 3% increase despite reporting 283% revenue growth in the first half of the year. MiniMax's M3 model ranks 18th on the same AI index.
3Strategic move in tech wars
China is boosting domestic semiconductor and AI capabilities in response to U.S. restrictions on advanced chip exports. While Nvidia faces limited access to the Chinese market, Huawei and other local firms are focusing on alternative solutions. Analysts suggest Z.ai likely uses Huawei Ascend chips along with other domestic suppliers.
4Hardware-software collaboration
Counterpoint Senior Research Analyst Ivan Lam noted Chinese companies are working towards deeper integration between hardware and software. AI developers in China are allocating more resources to servers and computing infrastructure based on domestic chips. This strategy represents a significant step toward technological self-sufficiency goals.
5Unverified claims
Z.ai's chip usage claims remain independently unverified, with the company declining to disclose specific suppliers. Experts point out that running an AI model requires less computing power than training one. The absence of leading U.S. AI models in China further increases demand for domestic solutions.
6Costs and competition
While MiniMax shares gained over 80% in the first half of the year, Z.ai outperformed with 800% growth. MiniMax reported adjusted net losses more than doubling to $293 million during the same period. Both companies went public in Hong Kong in January, with Z.ai scheduled to announce first-half results on Monday.
7Global platform success
Z.ai's GLM-5.3-Flash became the most used model on OpenRouter last week, demonstrating the performance of China-made chips. The model outperforms competitors like DeepSeek V4 Pro Max on the Artificial Analysis Intelligence Index, standing out as a cost-effective alternative in the market.
8Race for tech independence
China's advances in AI and semiconductors form a critical front in its technology competition with the U.S. The performance of companies like Z.ai and MiniMax reflects the growth of China's domestic tech ecosystem. Experts predict deeper hardware-software integration will be key to achieving technological self-sufficiency goals.