The Competition for Edge Computing Power in the AI Era: An Analysis of Business Valuations and Industry Prospects of Four Major SOC Chip Manufacturers
In the wave of comprehensive penetration of artificial intelligence technology, edge intelligent devices are becoming the core nodes for data generation and processing. As the “brain” of these smart terminals, System on Chip (SOC) technology iterations and market competition patterns are receiving significant attention. This article will deeply compare the business compositions and valuation levels of four manufacturers: Rockchip, Telink Semiconductor, Espressif Systems, and Amlogic, analyzing the investment logic and future prospects of the SOC edge chip industry in the AI era.
Business Landscape: Track Selection Under Differentiated Positioning
The four companies exhibit distinct differentiated layouts in the field of edge SOC chips, and this positioning difference directly determines their market performance and growth potential.
Rockchip has built a comprehensive AIoT SOC product matrix covering multiple scenarios, becoming a leader in domestic AIoT chips. The company’s core products include smart application processor chips and mixed-signal chips, with the flagship product RK3588 utilizing a 8nm process and featuring a self-developed NPU (Neural Processing Unit) with a computing power of 6 TOPS, achieving motion control response latency of less than 3 milliseconds, and is widely used in high-end fields such as automotive intelligent cockpits, machine vision, and industrial robots. The new generation AI vision processor RV1126B, set to launch in the first half of 2025, integrates a 3 TOPS NPU and an independent AI-ISP module, particularly optimizing energy efficiency in edge computing scenarios. This strategy of “one chip serving hundreds of industries” allows its products to cover hundreds of application scenarios, with revenue in the first half of 2025 increasing by 64% year-on-year to 2.046 billion yuan, and net profit soaring by 191% to 531 million yuan.
Telink Semiconductor focuses on the low-power Bluetooth (BLE) chip sector, establishing technical barriers in the wearable device and smart home controller markets. The company’s flagship product, the TLSR8258 series, supports BLE 5.0 and is known for its high integration and stability, widely used in smart wristbands, wireless keyboards, and mice. This focused strategy has led to industry-leading profitability, with a gross margin of 58.4% in Q4 2024, significantly higher than the industry average of 38.5%. Although its revenue scale is only about one-third of Rockchip’s, Telink achieved a quarter-on-quarter growth rate of 15.8% in Q4 2024, surpassing Rockchip’s 12%, reflecting the high prosperity of the IoT sub-sector.
Espressif Systems leverages Wi-Fi and Bluetooth dual-mode chips as its core competitiveness, occupying an important position in the consumer IoT market. The company’s star product, the ESP32 series, integrates Wi-Fi and Bluetooth functionalities and supports multiple communication protocols, becoming a mainstream choice for smart lighting, smart sockets, and smart speakers. Unlike Rockchip’s multi-scenario coverage, Espressif focuses more on standardized solutions in the consumer electronics field, lowering application barriers for customers by providing complete reference designs and development tools, which has established a stable customer base in the smart home chip market.
Amlogic has been deeply involved in the smart audio-visual terminal field for many years, with a product matrix covering SOC chips for smart set-top boxes, smart TVs, and smart cars. The company’s S series chips are adopted by well-known domestic and international manufacturers such as ZTE, Xiaomi, Alibaba, and Google, while the T series chips have entered the supply chains of mainstream TV brands like TCL, Hisense, and Changhong. Notably, Amlogic has also laid out automotive-grade chips, with some products passing automotive certification, supporting functions such as navigation, 360-degree panoramic view, and driver monitoring systems (DMS), beginning to enter the high-margin automotive electronics sector.
From the application scenario perspective, Rockchip and Amlogic lean towards mid-to-high-end smart devices, while Telink and Espressif focus on lightweight IoT terminals; from the technical path perspective, Rockchip invests the most in NPU computing power and edge computing optimization, while Telink and Espressif pay more attention to low-power designs for wireless connectivity, and Amlogic excels in multimedia processing and display technology. This differentiated positioning constitutes a diversified ecosystem in the edge SOC chip market.
Valuation Comparison: The Pricing Game of Growth Expectations and Technical Barriers
The market valuations of the four companies reflect the differences in growth expectations and technical barriers across different tracks. As of August 22, 2025, Rockchip’s TTM price-to-earnings ratio is 77.64 times, and its price-to-book ratio is 20.84 times; Telink’s price-to-earnings ratio is 62.97 times, and its price-to-book ratio is 5.24 times. This valuation difference arises from the different performance growth rates and reflects the market’s pricing of their technical scarcity.
Rockchip’s high valuation is closely related to its explosive growth in performance. The company’s net profit growth of 191% in the first half of 2025 far exceeds the revenue growth rate of 64%, with the gross margin in the second quarter rising to 43.3%, an increase of 6.5 percentage points year-on-year, indicating the effectiveness of upgrading its product structure towards mid-to-high-end. The market clearly recognizes the growth potential under its AIoT 2.0 strategy, especially in the expansion prospects of emerging fields such as robotics and automotive electronics. The next-generation flagship chip RK3688 that Rockchip is developing is expected to further enhance computing power, supporting its high valuation center.
Although Telink’s price-to-earnings ratio of 62.97 times is lower than Rockchip’s, it is significantly higher than its peers like UNISOC at 49 times, with the premium mainly coming from its gross margin level of over 50% and the technical scarcity of its AI layout. Broker estimates show that if the company’s AI chip business exceeds expectations and maintains a gross margin of 50%, the target market value for 2026 could reach 20 billion yuan, doubling from the current level. This valuation logic emphasizes the moat value of leading companies in niche fields.
While the valuation data for Espressif and Amlogic have not been fully disclosed, they can be inferred through industry comparisons. The consumer IoT chip market where Espressif operates is relatively competitive, and its valuation may fall between Telink and traditional chip manufacturers; Amlogic, benefiting from the dual drive of smart TVs and automotive electronics, is expected to have a valuation level closer to Rockchip. It is important to note that the valuation systems in different tracks vary—consumer electronics place more emphasis on shipment volume and customer stability, while the AIoT field focuses more on computing power metrics and scenario expansion capabilities.
From the perspective of the match between valuation and growth, Rockchip’s PEG (price-to-earnings growth ratio) is about 0.4 (77.64/191), while Telink’s is about 1.42 (62.97/44), indicating that Rockchip’s current valuation is more cost-effective. However, this simple comparison must consider industry characteristics—Rockchip’s AIoT track is inherently growing faster than Telink’s Bluetooth chip sector, making the higher valuation premium reasonable. In terms of technical barriers, Rockchip’s self-developed NPU capabilities and Amlogic’s automotive-grade technology certification constitute a high moat, which is also an important factor supporting its valuation.
Industry Prospects: The Edge Computing Power Revolution Driven by AI
The SOC edge chip industry is ushering in a historic opportunity brought by AI technology, with both market scale and technical requirements set to leap forward. The rise of edge computing is shifting computing power distribution from the cloud to the terminal, and the deployment of edge AI models is generating a huge demand for high energy-efficient SOC chips.
From the market demand perspective, the explosive growth of AIoT devices provides vast space for edge SOC chips. Rockchip pointed out in its semi-annual report that the development of AIoT will enter the “edge model-driven, terminal function interconnection and integration” 2.0 era, where AIoT applications across various industries can deploy applicable large models at the edge, redefining the functional boundaries of smart hardware. In this trend, SOC chips with NPU acceleration capabilities become a necessity—NPU is specifically optimized for AI computing, outperforming traditional CPUs and GPUs in performance, energy efficiency, and area efficiency, making them particularly suitable for local intelligent scenarios such as facial recognition and voice interaction. According to industry forecasts, the shipment volume of smart devices supporting edge AI is expected to grow from 1.5 billion units in 2024 to 3.5 billion units in 2027, with a compound annual growth rate exceeding 30%.
The technical evolution path presents two major directions: one is the enhancement of computing power, with Rockchip’s RK3588 achieving 6 TOPS computing power capable of supporting edge models with 3B and 7B parameters, and the next-generation products expected to break through 10 TOPS; the other is the optimization of energy efficiency, with Telink’s low-power technology and Espressif’s power management solutions continuously reducing the energy consumption per unit of computing power. These two paths correspond to different scenarios—industrial robots require high computing power to support complex motion control, while wearable devices are more sensitive to power consumption.
The wave of domestic substitution creates strategic opportunities for domestic manufacturers. In emerging fields such as AIoT, domestic and foreign manufacturers are starting from the same starting line, with companies like Rockchip and Amlogic gradually breaking the monopoly of foreign manufacturers by quickly responding to local customer needs and providing customized solutions. On the policy level, the national support policies for the semiconductor industry continue to strengthen, especially in high-end fields such as AI chips and automotive-grade chips, providing a favorable environment for domestic manufacturers’ technological research and development.
Industry competition will revolve around three core dimensions: first, the collaborative optimization capability of computing power and algorithms, with the ability to efficiently support mainstream edge AI models becoming key; second, ecosystem construction, with Rockchip building a developer ecosystem through complete reference designs and development tools, forming a network effect of “the more you use, the faster you iterate, and the wider the adaptation”; third, depth of scenarios, with Amlogic’s deep cultivation in the smart TV field and Telink’s in the wearable device field enabling them to better understand customer needs and optimize products.
However, the industry development also faces challenges. On one hand, the rapid iteration of edge AI models requires chip manufacturers to maintain high-intensity R&D investment, as evidenced by Rockchip’s launch of multiple new products in the first half of 2025; on the other hand, the price competition in the consumer electronics market is fierce, requiring manufacturers like Espressif to find a balance between cost control and performance improvement. Additionally, the uncertainty of the international supply chain and the limitations of high-end process technology are risks faced by the industry as a whole.
Investment Logic: Scene Positioning and Value Reassessment
Based on business layouts and industry trends, the four companies present different investment values and risk characteristics, requiring investors to choose based on their own risk preferences and investment cycles.
Rockchip represents the investment logic of “high growth + broad track.” The company’s comprehensive layout in the AIoT 2.0 era has begun to yield results, with rapid growth in emerging fields such as automotive electronics and robotics opening up a second growth curve. Financial data shows that the company’s product structure continues to optimize, with gross margin improvement and net profit growth far exceeding revenue growth, continuously improving profitability quality. The risk lies in the high valuation’s high demand for performance growth; if downstream demand falls short of expectations, it may face valuation adjustment pressure. For long-term investors, if the next-generation chips like RK3688 can be successfully mass-produced and gain market recognition, the company is expected to grow into a significant player in the global AIoT SOC field.
Telink’s investment value lies in the rarity of “niche leader + high profitability.” The company’s technical advantages in low-power Bluetooth chips have translated into gross margins exceeding 50%, a level that is rare in the semiconductor industry. With the continuous growth of the wearable device and smart home markets, as well as the proliferation of AI functions in these devices, Telink is expected to achieve simultaneous volume and price increases through product upgrades. Brokers are optimistic that its target market value has the potential to double, but caution is needed regarding the high customer concentration and relatively single product line risks.
Espressif is suitable for investors looking to position in “consumer IoT + ecosystem barriers.” The company’s technical accumulation in Wi-Fi and Bluetooth dual-mode chips and developer ecosystem provides it with a stable customer base in smart home scenarios. With the popularization of IoT standards like Matter, Espressif’s standardized solutions may gain a larger market share. However, the fierce price competition in the consumer electronics market and the rapid pace of technological iteration require the company to continuously launch more cost-effective products.
Amlogic offers a “steady growth + automotive electronics flexibility” investment target. The company’s stable business in smart set-top boxes and TV chips provides a performance safety net, while its layout in automotive-grade chips brings valuation enhancement potential. As the degree of automotive intelligence increases, the demand for in-vehicle SOC chips will grow rapidly; if Amlogic can achieve breakthroughs in this field, it is expected to open up new growth space. The main risks come from fluctuations in consumer electronics demand and the uncertainty of automotive product certification cycles.
From an industry perspective, the investment value of edge SOC chips can be evaluated using the formula “scene positioning value = computing power adaptability × ecosystem stickiness × policy fit.” Rockchip performs outstandingly in all three dimensions, especially in computing power adaptability and ecosystem stickiness; Telink has high ecosystem stickiness and policy fit; while Espressif and Amlogic have advantages in computing power adaptability in specific scenarios.
The revolution of edge computing power in the AI era has just begun. With the deep integration of edge computing, the Internet of Things, and artificial intelligence, the SOC edge chip industry will usher in sustained growth. For investors, it is essential to pay attention to the matching of short-term performance growth and valuation, while also focusing on long-term technical barriers and ecosystem building capabilities, seeking investment targets among leading companies in different tracks that combine growth and safety. Whether it is Rockchip’s comprehensive layout, Telink’s niche monopoly, Espressif’s ecosystem advantages, or Amlogic’s steady upgrades, they all reflect the diversified paths of industry development, and those companies that can accurately grasp scene demands and continuously innovate technologically will ultimately stand out in this competition for computing power.
Disclaimer: I plan to buy the four stocks mentioned in this article, which is directly related to my interests. This is for fun and should not be considered investment advice.