1. 2026: The Breakthrough Year for Edge AI
Artificial intelligence is undergoing a “descent revolution” from the cloud to the edge, with 2026 expected to be a key milestone for the large-scale implementation of edge AI. The dual support from policies and industry giants is opening up new growth opportunities in the sector — eight departments, including the Ministry of Commerce, have explicitly encouraged innovation in AI terminals, while giants like Apple, Meta, and OpenAI are intensifying their hardware strategies: Apple is adjusting its smart glasses roadmap, planning to launch a lightweight model in 2026 to catch up with Meta; Meta’s Ray-Ban smart glasses have sold 2 million units, with a production target of 10 million units for 2026; OpenAI is not only releasing an Apps SDK to connect high-frequency scenarios but also plans to launch several hardware products, including glasses and voice recorders.
Signs of explosive demand are already emerging. Categories such as AI smartphones, computers, and wearable devices are expanding comprehensively, with the AI smartphone market expected to reach $208.8 billion by 2027, and the AI computer market also projected to exceed $167 billion. More critically, applications are evolving from “tool-based” to “intelligent agent-based”: Gaode can proactively warn about weather, and Dingdong Maicai can automatically complete shopping lists, reshaping the logic of human-computer interaction. Although the three bottlenecks of “technology, experience, and ecosystem” have not yet been fully overcome, AIoT, with its advantages of vertical scenarios and seamless interaction, is expected to be the first field to achieve a high-value breakthrough.
2. Resonance Opportunities in the Semiconductor Cycle
The global semiconductor industry is experiencing a dual resonance of inventory cycles and innovation cycles. According to cyclical patterns, the Philadelphia Semiconductor Index shows approximately 60-month large cycle fluctuations, while global semiconductor sales follow a 2-3 year small cycle iteration. By 2026, the industry will officially shift from passive destocking to active restocking, as evidenced by the rise in the DXI index and DRAM prices. Breakthroughs in innovation are even more explosive: 2nm process technology is set to be implemented in 2026, coupled with the demand for AI computing power to migrate to the edge, the intelligent upgrade of terminal devices is forming a strong driving force.
For domestic semiconductors, this cycle holds special significance. After shifting to “self-controllable” development in 2020, the domestic industry chain, which previously followed global cyclical fluctuations, is now poised to replicate the leapfrogging miracle of the mobile internet era, leveraging both the engineer dividend and precision manufacturing advantages in the wave of edge AI. The current relatively stagnant pattern of domestic sectors instead nurtures greater valuation recovery potential.
3. SoC: The “Digital Heart” of Edge Intelligence
As the “brain” of terminal devices, SoC (System on Chip) is becoming the core beneficiary of this intelligent revolution. This highly integrated chip, which includes CPU, GPU, NPU, and other modules, has dominated the terminal chip market due to its advantages of low power consumption and high adaptability, with the global market size expected to reach $186.48 billion by 2025 and exceed $270 billion by 2030.
Dual breakthroughs in technology and performance are laying the foundation for SoC’s “Davis Double-Click”:
- Technological Breakthrough: Domestic SoCs have achieved mass production with advanced 6nm process technology, with NPU computing power covering 0.2-6 TOPS, adaptable to diverse scenarios from consumer electronics to industrial interconnect; leading companies have over 70% of their R&D personnel, and firms like Lenovo have achieved breakthroughs in edge model performance comparable to cloud through inference acceleration engines.
- Performance Improvement: The industry’s profitability continues to recover, with the average net profit margin increasing by 8.68 percentage points since 2023, and companies like Tailing Micro and Rockchip are expected to achieve several-fold profit growth in Q2 of 2024-2025.
- Valuation Mismatch: As of October 2025, leading companies like Amlogic and Hengxuan Technology have significantly lower P/E ratios compared to the STAR 50 Index, with valuation percentiles at historical lows, contrasting sharply with performance growth.
4. Investment Perspective: Grasping Core Links in the Industry Chain
The explosion of edge AI will transmit layer by layer along the “chip – component – complete machine” chain, with the following areas worthy of special attention:
- Leading SoC Chip Manufacturers: Amlogic (driven by AIoT + automotive), Hengxuan Technology (leader in wearable device chips), Tailing Micro (scarce IoT connection chip), with technological barriers and scene expansion capabilities as core competitiveness.
- Consumer Electronics Manufacturing: Luxshare Precision (deeply bound to leading customers, outstanding complete machine assembly capabilities), Goertek (leader in acoustic and VR/AR components, benefiting from interaction upgrades), and Foxconn Industrial Internet (the “contract manufacturing giant” for large-scale production).
- Key Components and Equipment: Gigadevice (main force in domestic storage chip substitution), Biwin Storage (consumer-grade storage volume), Sunny Optical (supplier of “visual entry” for smart terminals).
Potential risks to be cautious of: Downstream wafer factories may not expand production as expected, which could constrain supply; the impact of RISC-V architecture on the existing ecosystem needs continuous tracking; and uncertainties in global technology policies may also affect the rhythm of the industry chain.
As the wave of innovation in edge AI collides with the upward curve of the semiconductor cycle, the electronics industry stands at a new starting point for structural growth. SoC, as the core hub connecting technological breakthroughs and scene implementation, has increasingly clear logic of “performance growth + valuation recovery”. In this intelligent revolution, companies that master core technologies and position themselves in key scenarios will become the biggest winners in the new cycle.
Note: The above content is for information recording purposes only and does not involve any recommendations or encouragement to buy. The author will not participate in any of the aforementioned transactions; please make rational decisions.