Credit: Visual China

BEIJING, September 19 (TMTPost) – Inspur Electronic Information Industry Co., Ltd. (Inspur Information, 000977.SZ) has recently become a shareholder of Shanghai Yunmai Xinlian Technology Co., Ltd. (YunSilicon), according to industrial and commercial registration information.

At the same time, the registered capital of YunSilicon increased from about 2.27 million yuan to about 2.44 million yuan.

TMTPost has learned that the information is basically true. The amount of capital contribution by Inspur Information is 167,700 yuan, which makes the company hold approximately 6.9% of the shares in YunSilicon.

Inspur Information, incorporated on October 27, 1998, is the world’s second-largest and China’s largest server manufacturer, providing data center infrastructure, cloud computing, and artificial intelligence solutions. On June 8, 2000, the company was listed on the Shenzhen Stock Exchange.

The controlling shareholder of Inspur Information, Inspur Group, was founded in 1983 and is a domestic cloud computing and big data service provider. It has three publicly-traded subsidiaries: Inspur Information, Inspur Software, and Inspur Digital Enterprise. Its main businesses involve cloud computing, big data, industrial internet, new generation communication, and several application scenarios. It has provided IT products and services to more than 120 countries and regions worldwide.

According to the Gartner Global Server Market Report quoted by Inspur on its official website, in the first quarter of 2022, Inspur Information ranked second in the global server market with a market share of 10.4%, and ranked first in the Chinese market. According to IDC data, in the Chinese x86 server market share, Inspur ranks first, followed by New H3C.

On March 2, 2023, the Bureau of Industry and Security (BIS) under the U.S. Department of Commerce added 28 Chinese entities, including Inspur Group Co., Ltd., AI company Fourth Paradigm, and CPU manufacturer Loongson Technology, to its "Entity List." This means that U.S. companies need to apply for a license from the U.S. government when exporting or re-exporting products and technologies to the entities. In addition, Inspur Group is also subject to the Foreign-direct Product Rule (FDP), which means that software and technology not produced in the U.S. but controlled by the U.S. Export Administration Regulations (EAR) also require permission from the U.S. government.

Inspur Information, in its semi-annual report released on August 26, disclosed that its revenue for the first half of 2023 was 24.80 billion yuan, a year-on-year decrease of 28.85%; its net profit attributable to the parent company was 325 million yuan, a decrease of 65.91% year-on-year; and its non-net profit attributable to the parent company was 11 million yuan, a decrease of 98.7% year-on-year.

However, Inspur Information did not disclose the impact of U.S. sanctions in its semi-annual report. On July 17, Wang Endong, the chairman of Inspur Information and an academician of the Chinese Academy of Engineering, resigned from all positions in the company. In response, Inspur Information stated that this was a normal personnel change and would not affect the company's operations and production.

YunSilicon, in which Inspur Information has invested, was founded in May 2021. It is a chip design company in the field of high-performance Data Processing Units (DPUs) and intelligent network cards in China. It is committed to building network interconnect chips for large-scale data centers and cloud computing infrastructure. Its metaFusion and metaConnect series of intelligent network cards and DPU products can improve the overall computing efficiency of user computing clusters, release more CPU resources to support upper-layer applications, and help users build high-performance network infrastructure for end-network convergence.

DPU technology is considered one of the three pillars of data center chips, along with CPU (central processing unit) and GPU (graphics processing unit). In April 2020, Nvidia completed the acquisition of Israeli network chip manufacturer Mellanox for $6.9 billion and launched its first DPU in October 2020. Since then, DPU startups have emerged worldwide, especially this year when ChatGPT sparked  global demand for AI computing power. DPUs and RDMA network technology have become key elements in improving AI computing power.

According to YunSilicon, its RDMA high-performance network can solve the network acceleration problem of Chinese GPU products in large-scale AI models. It is expected that by the end of 2023, the company will launch intelligent network cards and DPU products based on its self-developed chips.

Prior to this, YunSilicon had completed three rounds of financing. Investors include IDG Capital, ByteDance, Lightspeed China, among others. This is one of the few chip projects invested by ByteDance. In addition, the company has worked with enterprises such as New H3C Group.

Since the beginning of this year, Inspur Information has announced three investment projects, including YunSilicon, network chip manufacturer WangXun Technology, and power chip R&D and design company Innovision Semiconductor, which are basically related to the chip industry chain. 

(This article was first published on the TMTPost App, author | Lin Zhijia)