chip

The demand for AI memories is suffocating mobile manufacturers. The largest Chinese chip producer is going to take advantage of it

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SMIC (Semiconductor Manufacturing International Corp) is the largest Chinese semiconductor manufacturer with a global market share of about 5%. This company is the best asset that Xi Jinping’s Government currently has to sustain China’s technological development. Hua Hong Semiconductor and SMES (Semiconductor Manufacturing Electronics Shaoxing) are also two very important chip manufacturers, but the true spearhead of this gigantic Asian country in this industry is SMIC. This company is partially public and has, as expected, the support of the Chinese Government. In fact, The Administration is investing a lot of money in their chip manufacturers. SMIC and the other Chinese chip producers do not have extreme ultraviolet photolithography (UVE), which are the most sophisticated that exist, but they do have the Twinscan NXT:2000i deep ultraviolet (UVP) equipment manufactured by the Dutch company ASML. These machines have not been designed to develop integrated circuits comparable to the most advanced ones currently manufactured by TSMC, Intel or Samsung, which is why the competitiveness of Chinese semiconductor manufacturers has suffered. Even so, SMIC has a plan to continue growing despite the impact that US sanctions are having on its business. And, according to SCMPis going to launch it now to take advantage of the bad times that manufacturers of smartphones and other consumer electronics devices are having. In March 2026. The memory supercycle for AI has put mobile phones on the ropes The DRAM memory industry is facing a profound structural transformation. The three largest chip manufacturers of memory on the planet, the South Korean companies SK Hynix and Samsung Electronics, and the American Micron Technology, They have reallocated about 70% of its production lines to high-bandwidth memories (HBM) to satisfy the currently insatiable demand of data centers specialized in artificial intelligence (AI). The current situation has triggered the birth of a supercycle in the memory market This situation has triggered the birth of a supercycle in the memory market, which is, simply, a presumably prolonged period of time during which the demand for a certain product far exceeds the offer. This scenario causes prices to skyrocket. In fact, that is what is currently happening with memory chips. And the big losers at the moment are the manufacturers of smartphones and other consumer electronics devices. This circumstance is precisely what SMIC wants to take advantage of to grow. And it plans to do so by trying to capture the entire low- and mid-range chip market that is being neglected. SK Hynix, Micron Technology and Samsung are focusing on the production of HBM integrated circuits because they leave them with a much higher profit margin than other memory technologies. SMIC cannot manufacture chips using cutting-edge photolithography beyond 7nmbut you don’t need them. Its current integration technologies are sufficient to manufacture the microcontrollers and memory chips demanded by mobile phone manufacturers. Image | Generated by Xataka with Gemini More information | SCMP In Xataka | We can forget about AI without hallucinations for now. NVIDIA CEO explains why

That Alibaba creates its own chip for AI agents is no surprise. Let it be neither ARM nor x86, but 5nm RISC-V, yes

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The Chinese giant Alibaba just announced the launch of its new high-end CPU, the XuanTie C950 processor. Developed by and for AI agents, it is a five-nanometer chip with a speed of 3.2 GHz whose surprise is not in any of these figures. The surprise is in its architecture, which is neither x86 nor ARM, but RISC-V. Therefore, it is not only the most powerful RISC-V processor created to date, but also a declaration of intent that can be summarized in two words: technological sovereignty. What is this chip about?. XuanTie CPUs are developed by Damo Academy, Alibaba’s research division. The previous model, the XuanTie C930, was announced on March 10 as the first server grade processor developed by Alibaba. Just two weeks later, the Chinese company has announced a new chip, the XuanTie C950, which is, according to the firm, three times more powerful than its predecessor (the C920 announced in 2024). Alibaba has not revealed which factory produced it, but it is based on the RISC-V architecturethat its process is five nanometers and that its speed amounts to 3.2 GHz. This launch occurs in a very particular context. Just a few days ago, and in response to the rapid adoption of OpenClaw by local companies, Alibaba Wukong announced.its platform for deploying AI agents in enterprise environments. This chip aims to improve the inference. In other words, the XuanTie C950 will serve to improve the computational process carried out by the language models in order to generate the responses that correspond to the requests they receive. In a context of agents working with files, data, and diverse environments, this is important. Processor prototype based on RISC-V architecture | Image: Wikimedia Commons Why RISC-V? Mainly, because unlike x86 and ARM, RISC-V is open and its use does not imply paying for licenses. According to Alibaba, “RISC-V’s open standard nature allows chip designers to customize instruction sets and accelerate specific AI workloads with little or no licensing costs. This is especially important for the development of AI agents.” Let’s think of RISC-V as what Linux is to Windows and Mac. If a company wants to use x86 (Intel and AMD) or ARM (SoftBank) architectures, it must pay a license. Not only that, but x86 and ARM are exposed to possible restrictions by the United States. With RISC-V, this risk disappears, which is why so much China like the European Union have found in it an escape valve towards sovereignty and technological independence. The surprising thing. That a Chinese company has managed to produce a five-nanometer chip is, to say the least, striking. To manufacture these processors it is necessary to use deep ultraviolet lithography (UVP) and, normally, machinery produced by the Dutch ASML. We know that SMIC (Semiconductor Manufacturing International Corp), the largest Chinese semiconductor manufacturer, had been at least since 2023 developing its own five-nanometer lithography, but with unacceptable results. When a chip wafer is manufactured, it is normal for some of its cores to malfunction. If we talk about profitability, the yield per wafer must be 70%that is, seven out of every ten cores produced work. In the year 2025, the yield of SMIC wafers was at 30%. That today, at the beginning of 2026, we see a five-nanometer chip produced, a priori, in China, would be a punch on the table by the Asian country and a strong sprint in the AI ​​race. However, it does not seem feasible. The other option, and perhaps the most plausible, is that it is not manufactured by SMIC, but by TSMC. SMIC has not managed to manufacture five-nanometer chips using the multiple patterning on your ASML UVP machines. The Taiwanese TSMC does have that capacity and, according to Nikkei Asiawill be the one who manufactures it. Be that as it may, it is a great step for the RISC-V architecture, which has gone from being relegated to small devices to reaching the league of the big ones. Featured image | Alibaba In Xataka | There is a city in China that goes head to head with Silicon Valley: welcome to Hangzhou, the home of the ‘Six Little Dragons’

China has started a battle against the US and Japan that no one is talking about. And it is crucial to winning the chip war

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In the semiconductor war that the US and China are fighting Companies that specialize in the manufacture of photolithography equipment tend to attract attention, such as ASML; those that design the chips, such as NVIDIA or AMD; and the companies that produce them, such as TSMC or Samsung. However, in this complex network there are other much less known companies that also play an essential role in the integrated circuit industry. One of them is the Japanese company JSR Corporation. This entity is one of the industrial strongholds of Japan. And it is because it supplies its photoresist liquids to most of the semiconductor manufacturers that produce cutting-edge chips, helping to sustain Japan’s leadership in a very important area that usually goes unnoticed: that of the manufacture of advanced materials to produce integrated circuits. For China to have its own advanced photoresist liquids in your path to total independence of its chip industry is crucial, so its plan involves break Japan’s monopoly in no more than five years. China prepares to intimidate Japan The photolithography equipment designed and produced by ASML is responsible, very roughly, for transferring the geometric pattern described by the mask with great precision to the surface of the silicon wafer. In this area we can observe the pattern as the “drawing” that delimits the distribution of the transistors, the connections and the other elements that make up an integrated circuit. Before transferring the geometric pattern to the wafer, it is necessary to pour a liquid capable of absorbing light and preserving the pattern on it. However, before reaching this very important step, it is necessary to subject the wafers to a process known as deposition. It usually involves equipment manufactured by Tokyo Electron or Applied Materials. Its purpose is prepare silicon wafers for the transfer of the geometric pattern by depositing a very thin layer of material on them. Depending on the type of chip being manufactured, it will be necessary to use one material or another. One of the most used deposition techniques is known as oxidation, and consists of taking advantage of the ability of silicon to form a very thin layer of oxide when reacting with water. Its purpose is to protect the transistors and other chip components from external contamination. However, before transferring the geometric pattern to the wafer using lithography equipment, it is necessary to pour a liquid capable of absorbing light and preserving the pattern on it. This is the function of the photoresist fluid. During the last two decades, all companies specialized in the production of photoresist materials have been Japanese. In fact, Japan has since then the monopoly of this marketwhich is currently led by JSR Corporation. For the US, one of its main allies should lead this market not a problembut the possibility of China developing the capacity to produce its own advanced photoresist materials on its path to cutting-edge chip manufacturing is an issue. The Chinese government knows that photoresist production is a critical bottleneck, which is why its latest five-year plan has set out to resolve it. Xuzhou B&C Chemical, which is one of the leading photoresist materials manufacturers in China, anticipates that in at most five years will have the capacity to produce large-scale advanced KrF photoresists (Krypton Fluoride) and ArF (Argon Fluoride). Precisely this last material is commonly used in nodes equipped with deep ultraviolet (UVP) lithography equipment. However, the great challenge facing China is the development of photoresists suitable for the production of integrated circuits in extreme ultraviolet (EUV) nodes. We will see what achievements it achieves over the next five years. Image | Generated by Xataka with Gemini More information | SCMP In Xataka | Japan takes the lead with nuclear fusion and sets an extremely ambitious date: the 2030s

China already has two chip manufacturers with 7nm technology. This is very bad news for the US and its allies.

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SMIC (Semiconductor Manufacturing International Corp), the largest Chinese semiconductor manufacturer, has the capacity to produce 7nm chips from 2023. At the beginning of September of that year this company shook up the integrated circuit industry by demonstrating that it had been able to manufacture these semiconductors despite not having access to UVE photolithography equipment (extreme ultraviolet) produced by the Dutch company ASML. These highly sophisticated machines are necessary to manufacture cutting-edge chipsand ASML cannot sell them to its Chinese customers because the US, which controls some of the patents used by this equipment, prohibits it. Still, in 2023 SMIC and Huawei worked hand in hand to manufacture 7nm ICs without using ASML’s EUU machines. Of course, they used deep ultraviolet (UVP) equipment that this company from the Netherlands also produces. UVP machines are not as advanced as UVE machines, but with proper refinements they can be used to manufacture cutting-edge integrated circuits. And now China has two semiconductor manufacturers capable of producing 7nm chips. As we have just seen, one of them is SMIC, and the other, according to Reutersis Hua Hong Semiconductor, the country’s second largest integrated circuit producer. The shadow of ‘multiple patterning’ is very long Hua Hong Semiconductor’s division specializing in third-party chip manufacturing is called Huali Microelectronics, and, again according to Reutersis preparing to start production of 7nm integrated circuits at its Shanghai plant. The sources that have revealed this information assure that Huawei has collaborated with Huali Microelectronics on this project, which invites us to reach two reasonable conclusions. It is very likely that with the help of Huawei, Huali has developed ‘multiple patterning’ techniques The first is that Huali’s 7nm lithography will most likely play an essential role in GPU production capacity for artificial intelligence (AI) from both Huawei and other Chinese companies. And the second conclusion is actually a plausible hypothesis. And, like SMIC, Huali does not have access to ASML SVU equipment. For this reason, it is very likely that with the help of Huawei it has developed security techniques. multiple patterning to be able to manufacture 7nm chips with the UVP machines in its possession. A priori, UVP machines are suitable for manufacturing semiconductors up to 10 nm. And with EUVs it is possible to exceed 3 nm. However, by refining the processes involved in transferring the pattern to the wafer and turning to multiple patterning It is possible to go beyond these integration technologies. This technique broadly consists of transferring the pattern to the wafer in several passes with the purpose of increasing the resolution of the lithographic process. It may have an upward impact on the cost of chips and a downward impact on production capacity, but it works. Either way, Huali Microelectronics is going to face the same challenges that SMIC has dealt with for the last three years: the multiple patterning seriously limits the number of viable chips per wafer that is possible to manufacture. And, therefore, it increases its cost. Still, it is very important for Chinese AI chip designers to have access to two companies capable of producing their designs with advanced photolithography technology. And for Hua Hong Semiconductor it is crucial to have the ability to manufacture, thanks to Huali, cutting-edge integrated circuits and not just 22 nm or larger (this is the most advanced photolithography it had so far). Image | Generated by Xataka with Gemini More information | Reuters In Xataka | TSMC is already the highest-earning chipmaker on the planet. It has beaten two semiconductor giants

It took Apple to put the iPhone chip in a computer so that we know that the iPhone is as powerful as a computer

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He MacBook Neo It is surprising analysts and buyers with its good performance. And the question should be: why? It is the first time that Apple has made a move of this caliber to make one of its star products cheaper: putting the processor of an iPhone inside a Mac. We consumers have so internalized that “a cell phone is a cell phone” and that “a PC is a PC” that, usually, we do not pay attention to what we usually have in our pockets. It took Apple to put the processor of an iPhone in a PC to realize that, precisely, what we have in our pocket is a PC. “Move up to 4k videos”. X is filled with analysts thoroughly testing the MacBook Neo, and hallucinating that it is capable of doing… what any other MacBook can do. The 8 GB of RAM is a limitation, as it was in the first generations of Macs with M1 chip. But, far from that “use for office, basic and browser”, the Neo is surprising for being capable of what is expected of a Mac: do more than that. The main limitation is given by the 8 GB of RAM, which is few even for a Mac, but not by the chip. It’s normal. A Mac with a mobile chip. It sounds like a crazy idea. But if we look (not even in depth) at A18 Prowe understand perfectly what is happening. No matter how much Apple mounts the A18 Pro in a mobile phone, it is a chip that far exceeds the capabilities that even a desktop or laptop would need for “basic use.” In fact, the A18 Pro scores above an M1 in Single-Core, it is not far behind in graphical performance and is much more advanced at the manufacturing level (number of transistors, instructions, frequencies). In fact, it’s not just an Apple thing: a Snapdragon 8 Elite sweeps an M1 in multi-core and reaches a M2 in single. We weren’t realizing. We have been saying for years that the power of mobile phones is completely excessive. A certain part is necessary for the highest-end mobile phones to be able to record in 8K, process images in real time and operate at the rate they work, but 90% we are driving at 30 km/h in a supercar that exceeds 300. This is not something new. In fact, for years Apple’s A processors were outperforming Intel’s, back in the days when M chips didn’t exist. As told John Gruberthe A9 CPU of the iPhone 6s In 2015 (it has rained) it was already comparable to MacBooks from 2013. In 2017, as he says Antonio Sabanthe iPad Pro was already faster than the MacBook Pro with the I7 chip. Just what was needed. Macs have historically been characterized as a perfect mobility solution for designers, musicians, video editors and other creators. But there was an even bigger niche: people who don’t do any of that and want a computer for “normal” use. While MacBook Airs are not over-the-top Macs, they offer much more than any average user needs. In fact, I myself bought an Air M4 and not a Pro because, even as a video editor, I don’t need much else. Apple has found in the Neo more than possibly the “e” phenomenona formula that we will see year after year if we achieve commercial success. Image | Apple In Xataka | Apple has only found one option to make a cheap laptop: make it a mobile

the cheapest laptop in Apple history with iPhone chip

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It was expected like May water by fans of the firm with the bitten apple and, last week, Apple finally cleared up the rumors and presented the MacBook Neothe cheapest laptop in its entire history. Now, you can buy from 699 euros. This is the price for the 13-inch model with 256 GB, although the 512 GB variant with touch ID is available for 100 euros more: 799 euros. Apple MacBook Neo 13-Inch with A18 Pro Chip, 256 GB The price could vary. We earn commission from these links Apple MacBook Neo 13 Inch with A18 Pro Chip 512 GB and Touch ID The price could vary. We earn commission from these links A cheap Apple laptop perfect for less demanding users It is true that for an Apple laptop, the MacBook Neo It is modest in specifications, but it is true that it presents a excellent value for moneyideal for those who want a computer from the firm of the bitten apple without having to pay 1,000 euros for the base model. The MacBook Neo is perfect for those who want enter the Apple ecosystem without paying more. This is a move in which Apple has been trying to succeed for a long time with the launch of cheaper devices such as the iPhone 17e or the Apple Watch SE 3. This MacBook Neo is designed for everyday use, with more than enough features for a standard user. Its screen is type 13 inch IPS LCDwith a resolution of 2,408 x 1,506 pixels and a brightness of 500 nits. The surprise of this laptop is that, unlike all other Apple models, it mounts the chip Apple A18 Prothe same as the iPhone 16 Pro and that is more than enough for browsing, checking email, editing an image and everyday work tasks. Its light weight 1.2kgmakes it an inseparable companion for those who have to carry the office on their backs every day. In addition, it stands out for its battery that, according to company data, lasts up to 16 hours, so you can forget about charging it while you work. Of course, despite some advantages, it is true that there is an unwritten agreement by which you assume that by buying a MacBook for 699 euros you have to give up some things. For example, The keyboard does not have a backlight nor does it come with a wall charger. In terms of connectivity, it only has two ports USB-CWiFi 6E, Bluetooth 6.0 and 3.5 mm headphone jack. Finally, one of the things that is also striking about this cheap Apple laptop is that you can buy it in four different colors. ⚡ IN SUMMARY: macbook neo laptop ✅ THE BEST The price: It is the first Apple MacBook for which you have to pay less than 700 euros at launch. Very light and portable: Weighing only 1.2 kg, it is a perfect laptop to take with you every day to the office or university. ❌ THE WORST Oh, the RAM… 8 GB of RAM may be a bit short for intense multitasking and the worst thing is that it cannot be expanded. Yesand they miss some things… With no backlit mouse, no wall charger and only two USB-C ports, these are some of the things you have to sacrifice if you want to pay little for a MacBook. 💡 BUY IT IF… You want a cheap Mac for studying, browsing, watching videos or even everyday work. ⛔ DON’T BUY IT IF… You are a person who wants a laptop to edit video, program many apps or who wants a device that will last for many years. Some accessories that may interest you for this MacBook Neo BENFEI Laptop Stand with Docking Station USB C 6 in 1 The price could vary. We earn commission from these links tomtoc 360° Case for 13 Inch The price could vary. We earn commission from these links Some of the links in this article are affiliated and may provide a benefit to Xataka. In case of non-availability, offers may vary. Images | Pedro Aznar (Applesfera) and Apple In Xataka | MacBook Air M4 vs MackBook Air M3: these are the main differences between the two models In Xataka | MacBook Air Vs MacBook Pro: we explain which one to choose

Chip War is Xataka Xtra’s newsletter about the technological battle of our time: semiconductors

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‘Chip War’ is one of the newsletters exclusives included in Xataka Xtrathe Xataka subscription plan. We send it every Monday and it is part of a benefits plan that includes access to other newsletters, a consultation with editors and raffles and discounts exclusive for subscribers. The first draw, a 75″ TV. The semiconductor industry is not just technology. It is geopolitics, economics and industrial strategy condensed into objects of a few nanometers. The decisions made today by TSMC, Intel, ASML, Samsung or SK Hynix (or the governments that support them) will determine which countries lead the next decade and under what conditions. Every Monday we analyze what is happening in that race: the conflicts between the United States and China, the movements of large factories, the subsidies that are changing the geography of production or the technological bets that can change who is in charge in the sector. Without rush and with context. The goal is not to tell you the news, but to help you understand why it matters. Why does it matter so much? Do you want an example? In our Substack we share the first edition for free. Other Xataka Xtra newsletters Next X (biweekly, every other Thursday): analysis of the trends in technology and science that are changing the present and will define the future: AI, quantum computing, biotechnology, space exploration. Context and perspective on where we are going and why it matters. B-sides (weekly, every Saturday): five curious and fascinating readings each week. Strange, counterintuitive or unexpected stories that we find on the Internet and that deserve your attention. From industrial accidents that changed the world to surprising scientific research or absurdities of late capitalism. Featured image | Xataka

So a MacBook with an iPhone chip can have macOS. But an iPad with an M4 chip, no

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Neo. It is the surname that gives life to the new cheap macbook. 699 euros for a Mac with a good panel, a promising speaker system, a design that makes you fall in love at first sight and that, for all those looking for a simple laptop for office purposes, is considered one of the best options on the market. The small detail is that, with its launch, Apple has admitted that running macOS It is not particularly demanding at the hardware level. So much so that we find ourselves faced with the paradox of having a processor of iPhone 16 Pro running macOS and iPads worth thousands of euros with M4 chip running… iPadOS (iOS with some modifications). A movement with meaning. My colleague Javier Lacort told it, the only option that Apple has found to make a cheap laptop has been to give it the heart of a mobile. It is thus manifested, indirectly, that a A18 Pro It is more than enough for the majority of potential consumers of this laptop. But there is a key that can hurt users of latest generation iPads: right now there is a laptop with an A18 Pro moving PC programs, while a iPad with an M4 chip moves completely layered apps. The point is not just macOS, the point is the apps. Apple has been implementing M chips in its iPads for years. We all agree that a Mac is a Mac and an iPad is an iPad but… selling a iPad with an M4 chip and phone applications is to sell a horse tied by the legs. It is an inexplicable paradox, one in which a MacBook with an A18 Pro can run desktop programs like Davinci Resolve, Adobe Premiere or Lightroom CC, while a much more powerful iPad has layered versions closer to those of a mobile phone. I don’t want a touch Macbook, I want an iPad according to its hardware. In my particular case, I am the perfect potential buyer of an iPad capable of running desktop apps. I work 90% of my day in front of the PC, but mobility is very important to me. And the iPad + keyboard format sweeps any Mac, no matter how small. But I have been forced to buy a MacBook Air M4 because, with an iPad, it is simply impossible to do my work. The apps are not up to par with the processor, and for professional uses it is of little use to have one of the best processors on the market if the operating system is nailed to that of my iPhone. It’s not going to happen. Dreaming of an iPad with macOS or, at least, capable of running some desktop applications, is still a dream. Apple is clear about its product categories and, although it sells the iPad M as productivity tools, they are still products limited to the use that Apple wants us to give them. Be that as it may, reality is inevitable: the iPad falls short of iPadOS. It is a platform that, in its day, made sense as a version of iOS for tablets. Today, the iPad is more powerful than most computers on the market and, at the very least, deserves software on its level. Image | Apple In Xataka | I’ve tried replacing my MacBook Pro with the new iPad Pro. iPadOS is still a stumbling block

Scientists have connected 200,000 human neurons to a chip. And he made them play ‘Doom’

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If they tell us that human neurons are playing ‘Doom’, the first thing we would think of is science fiction. However, that is exactly what the Australian company Cortical Labs has shown with your CL1 system: about 200,000 live neurons grown on an array of electrodes on a chip, capable of receiving information from the game and responding through electrical patterns. We are not talking about conventional artificial intelligence, but rather biological tissue interacting with software through an interface designed for that purpose. Human neurons and ‘Doom’. The demo isn’t just launching the game and letting something random happen. In the material shared by Cortical Labs, those responsible explain that the system receives signals from the video game environment and generates electrical patterns that translate into the character’s actions. This is a form of learning in which the system modifies its response depending on the result obtained. The key here is not skill, but the ability to adapt, which, according to the company, they are managing to train and mold in real time. How the interaction loop is established. For the experiment to work, it is not enough to display images on a screen. According to CTO David Hogan, an independent developer managed to convert the game’s visual signal into “electrical stimulation patterns” that are applied directly to the cell culture. These stimuli provoke electrical responses in neurons, and certain firing patterns translate into specific actions within ‘Doom’. In this way, the system creates a closed loop in real time in which each decision has an immediate effect on the virtual environment. look back. In 2021, the same company managed to make a system based on more than 800,000 neurons play ‘Pong’an experiment that required years of scientific work and specific training. That precedent laid the foundations for what would later become the CL1, the equipment presented at the Mobile World Congress in 2025 as the world’s first commercial biological computer. As we explained at the time, the system combines neurons grown on silicon with software called biOS, responsible for exchanging electrical information with living tissue. It is advisable to adjust expectations. The system, it should be noted, falls far short of advanced human performance. Brett Kagan of Cortical Labs emphasizes that the experiment is not intended to replicate a miniature brain, and rejects the direct comparison: “Yes, it is alive, and yes, it is biological, but it is actually used as a material that can process information in very special ways that we cannot recreate in silicon.” The emphasis, therefore, is not on skill, but on the type of processing that this biological substrate allows. Starting point. In the video, the team encourages researchers and developers to interact with the CL1 open API. Cortical Labs hopes to address progressively more demanding tasks than a classic video game, although the video itself also recognizes that there is room to fine-tune the feedback of successes and errors. For now, what we have is a proof of concept that shows potential, but whose path will depend on what others manage to build on this platform. Images | Cortical Labs In Xataka | Sam Altman has spent his entire life saying one thing and doing exactly the opposite. And this time it didn’t even take 48 hours.

A Japanese toilet company has been manufacturing key parts in the chip industry for years. And now it is going to be key in AI

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Toto, world famous for their toilets with a trickle that we usually miss so much when we return from Japan, has been quietly manufacturing key components for the semiconductor industry for decades. Just like account Financial Times, an activist fund has focused on that part of its business, and the market is starting to pay attention. What has happened. Palliser Capital, a UK-based activist fund, has sent a letter to Toto’s board of directors arguing that the advanced ceramics the company works on are being ignored and underestimated by the market. The fund, which owns a stake among the 20 largest in the company, according to share from FT, calls Toto “the most underrated and overlooked AI memory beneficiary.” What is important. Toto is not just a bathroom company. Since 1988 it has been manufacturing the so-called ‘electrostatic chucks’ in series.‘ (electrostatic jaws), high-precision ceramic components used in the manufacture of NAND memory chips to hold silicon wafers during the production process, controlling temperature and avoiding contamination. This business, which they fit within their “advanced ceramics” division, already represents around 42% of the company’s total operating profit, according to data from Bloomberg. The connection with AI. He data center boom for artificial intelligence has skyrocketed the demand for memory chips. Companies like Meta, Amazon or large memory manufacturers (SK Hynix, Samsung, Kioxia) are accelerating their production to face a widespread shortage. That translates into more demand for the components that Toto manufactures. The company’s ceramic technology is also specially adapted for cryogenic etching, a process that is expected to gain popularity as memory chips become more complex and layered. Business tips. According to share The fund also criticizes that Toto is not explaining well to investors the importance of this segment and that the allocation of internal capital is not prioritizing this lucrative sector. The fund proposes that the company expand its ceramics business, sell cross-stakes in other companies and make better use of its 76 billion yen in cash (about $496 million). If Toto did all that, Palliser estimates the stock could rise more than 55%. The market had already started to move. Toto shares have accumulated a revaluation of more than 60% in the last year. Just like share Bloomberg, at the end of January, after the support of Goldman Sachs, which raised the value to buy pointing to the memory shortage as a tailwind, the stock rose 11% in a single day, its biggest rise in five years. Be careful with the warnings. The idea that Toto would have that competitive advantage before other competitors can be at that level comes from Palliser himself, who has an obvious interest in making that narrative credible. Tom’s Hardware points out that while electrostatic jaws play a real role in advanced manufacturing processes, whether that translates into sustained growth still depends in part on large memory manufacturers committing to expanding production and, for now, they are being cautious faced with the risk of oversupply if the AI ​​market cools. The phenomenon is not exclusive to Toto. Japan has a long history in chip production, which has led companies with very different profiles to develop businesses related to semiconductors almost without anyone noticing. Just like share Bloomberg, Ajinomoto, known for its broths and its mastery of umami, makes insulating films for chips based on its expertise with amino acids. Kao, a cosmetics company, has a silicon wafer cleaning business. The AI ​​business is revaluing companies that, a priori, had nothing to do with it. And Toto is the latest example of this. Cover image | Taylor Vick and Upgraded Points In Xataka | What future awaits artists with the rise of AI? In Ireland they see it so black that they are already preparing a basic income

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