# Moore Threads turns first profit on 1,774% GPU revenue surge *The Beijing designer posted third-quarter revenue of 1.552 billion yuan and 49.26 million yuan in net profit from MTT S5000 accelerator deliveries.* **Published:** November 11, 2026 **By:** Wei Zhang **Section:** Semiconductors & AI Hardware — China **Format:** Why It Matters **Confidence:** high **Source:** https://eastasiabrief.com/semiconductors/moore-threads-turns-first-profit-1-774-gpu-revenue-1195 **Publisher:** East Asia Brief (https://eastasiabrief.com/) --- ## What to know - Moore Threads booked third-quarter revenue of 1.552 billion yuan to mark its first adjusted profit - Negative operating cash flow at Moore Threads reached 3.309 billion yuan over nine months - Biren Technology files its next mandatory audited results on the Hong Kong exchange in March 2027 ![Technicians in protective suits operate equipment inside a semiconductor manufacturing facility lined with automated machinery and monitors. (AI-generated image)](https://eastasiabrief.com/media/2026-11-06-45c1694a51b3.webp) *Technicians in protective suits operate equipment inside a semiconductor manufacturing facility lined with automated machinery and monitors. (AI-generated image)* Chinese chip designer Moore Threads confirmed on Nov. 6, 2026, that third-quarter shipments of its MTT S5000 accelerator delivered the company's first quarterly operating profit, reversing years of net losses. The Beijing-based developer, which listed on Shanghai's STAR Market, posted third-quarter revenue of 1.552 billion yuan ($233.4 million), an increase of 1,773.92% from the same period last year. Net profit attributable to shareholders reached 49.26 million yuan ($7.4 million), the company said in its quarterly filing. Stripping out government subsidies and non-recurring gains, adjusted net profit stood at 20.07 million yuan ($3.0 million). That adjusted profit represents an operating margin of roughly 1.3%. The margin reflects the steep manufacturing costs domestic fabless designers absorb to price their accelerators competitively against foreign alternatives. The revenue surge follows regulatory directives from Chinese authorities requiring domestic telecommunications operators and cloud data centers to source a larger portion of their computing hardware from local suppliers. The mandate accelerated after the United States Department of Commerce tightened export restrictions on high-performance accelerators, barring Nvidia from shipping its flagship processors to Chinese buyers. Fellow accelerator designer MetaX also reported profitability in the same reporting window. The Shanghai-based firm generated 1.500 billion yuan ($225.8 million) in third-quarter revenue, a rise of 367.12% year over year. MetaX booked an adjusted net profit of 308 million yuan ($46.4 million) for the quarter, marking its second straight quarter of positive adjusted earnings. The company ramped mass production of its Xiyun C600 processor in May. Cambricon Technologies, the largest publicly traded domestic processor designer, posted third-quarter revenue of 3.531 billion yuan ($485.4 million), an increase of 104.5% year over year. Net profit at Cambricon grew 147.7% to 1.404 billion yuan ($192.5 million). However, the figure fell more than 40% below consensus projections of 6.26 billion yuan due to component shortages. Market speculation that Shanghai Biren Technology achieved profitability alongside its domestic peers proved inaccurate. Biren Technology is listed on the Hong Kong Stock Exchange, which requires only semiannual financial disclosures. Official interim filings show Biren Technology generated 1.236 billion yuan in revenue during the first half of 2026, accompanied by a net loss of 377 million yuan. A report by DBS Bank projected the company will not reach net profitability until 2027. Beneath the headline revenue growth, corporate balance sheets show operational strain across the domestic sector. Cash burn remains severe as companies stockpile silicon wafers, memory modules and finished circuit boards. Moore Threads recorded a net operating cash outflow of 3.309 billion yuan ($497.5 million) across the first nine months of 2026. The outflow exceeded its total nine-month sales of 3.289 billion yuan. To fund production, Moore Threads increased its long-term borrowings to 3.65 billion yuan from 1.49 billion yuan at the close of 2025. Cash reserves dropped from 9.18 billion yuan to 5.39 billion yuan over nine months. Inventory levels at Moore Threads jumped 152.43% from December to 3.363 billion yuan ($505.7 million). Cambricon reported an inventory balance of 11.665 billion yuan, tying up capital ahead of customer shipments. Holding vast stocks of accelerators introduces write-down hazards. In the fast-moving artificial intelligence market, older architectures risk sudden obsolescence if competitors deploy faster designs before existing stocks clear. Profit margins have begun to erode under production pressure. The nine-month gross margin at Moore Threads fell to 53.71%, down 8.16 percentage points from 61.87% recorded during the first nine months of 2025. The margin compression stems from rising procurement costs for high-bandwidth memory (HBM). Access to the latest memory standards remains constrained under trade rules, forcing Chinese firms to pay premiums through secondary supply channels. Advanced packaging also constrains domestic scaling. Chinese foundries rely on multi-chip packaging to link multiple dies, a technique that compensates for lithography limitations but lowers manufacturing yields. Lower wafer yields raise unit production costs. Domestic designers must absorb these expenses because enterprise cloud customers resist paying more for domestic hardware than for comparable foreign inventory. Nvidia continues to command commercial influence despite trade restrictions. Research firm IDC reported that Nvidia maintained roughly 34% of China's artificial intelligence accelerator market during the first six months of 2026. Domestic tech conglomerates continue testing local chips while maintaining existing Nvidia clusters. Engineers report that migrating deep learning models from Nvidia's proprietary CUDA software framework to domestic platforms requires substantial programming time. Huawei Technologies represents another formidable domestic competitor. The Shenzhen-based company provides its Ascend series processors directly to enterprise clients, operating its own integrated software stack and server distribution network. The regulatory filings published by the Shanghai Stock Exchange do not disclose the volume of confirmed purchase orders tied to Moore Threads' 3.36 billion yuan inventory balance. The exchange also does not state wafer scrap rates at partner fabs. Biren Technology faces its next mandatory financial disclosure in March 2027, when full-year audited statements will show whether shipments of its BR20X chip have commenced. ## Impact map | Event | Korea | China | Japan | Global impact | | --- | --- | --- | --- | --- | | China domestic AI chip substitution | Memory makers see direct HBM shipments restricted, rerouting sales through third-party packaging hubs | Moore Threads and MetaX book initial operating profits on domestic cloud server contracts | Semiconductor tool vendors face Chinese demand shifted to mature packaging nodes | Server buyers face dual-track AI infrastructure as China accelerates domestic accelerator use | ## In this story - **Companies:** Moore Threads, MetaX, Cambricon Technologies, Biren Technology - **Tickers:** 688795.SH, 688802.SH, 688256.SH, 06082.HK - **Exposed:** Nvidia, Huawei Technologies - **Policy:** Export Controls, Subsidies - **Impact:** Supply Chain, Order Book, Cost Structure ## Primary sources 1. hkexnews.hk 2. qq.com 3. sohu.com 4. 36kr.com --- Cite as: East Asia Brief, "Moore Threads turns first profit on 1,774% GPU revenue surge," November 11, 2026. https://eastasiabrief.com/semiconductors/moore-threads-turns-first-profit-1-774-gpu-revenue-1195