China’s New AI IPO Moore Threads Skyrockets 425% on Debut

Moore Threads Soars 425% on Debut as Investors Chase the Next Nvidia

It’s starting to look like any company with an AI label in China can trigger enormous rallies, as the country pushes aggressively to rival US dominance in artificial intelligence. Despite China already being ahead in several AI applications, investor enthusiasm has gone into overdrive.

The latest example is Moore Threads, which exploded 425% on debut after listing on China’s public markets. The company raised over US$1 billion in its IPO, a huge amount for a tech debut and a strong sign of the capital flooding into China’s AI ambitions.

Founded in 2020 by former Nvidia executive Zhang Jianzhong, Moore Threads is positioning itself as a domestic alternative in the AI chip race. Its stock surged more than fivefold on opening day, fuelling the view that China may be experiencing an AI bubble of its own.

Investor appetite is enormous, policy support is strong, and capital is flowing, but the speed and scale of these moves suggest that China’s AI hype cycle may be accelerating faster than fundamentals can keep up.

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China’s AI Chip Race Faces a Long Road Ahead

Moore Threads operates in a similar space to Nvidia, designing graphics processing units (GPUs), high-performance computational chips capable of running many tasks simultaneously, which makes them essential for AI workloads. The company’s revenue tripled last year, but it remains loss-making, highlighting how early it still is in its commercial journey. That said, revenue growth is expected to remain strong as China accelerates efforts to build a domestic AI chip ecosystem across both public and private markets.

However, investors should recognise that while China is spending aggressively to develop its own AI chipmakers, the country is still many years behind the engineering sophistication seen at the top global players. Replicating the advanced chip design and manufacturing capabilities of companies like Nvidia remains a long-term challenge, even with heavy state support.

Investors have poured billions into the Chinese tech sector since Chinese startup DeepSeek released a large language model earlier this year to rival OpenAI’s ChatGPT, at a fraction of the cost. Since then, tech titans like Alibaba and Tencent have competed to roll out increasingly advanced AI models.

For its part, the U.S. has sought to limit China’s access to cutting-edge technology. In October 2023, the Biden administration added Moore Threads to an export blacklist, the Commerce Department’s so-called entity list, citing national-security concerns.

China Doubles Down on AI

China will continue pouring investment into AI startups as it pushes to accelerate innovation and close the gap with global leaders. Historically, one of China’s greatest competitive advantages has been its ability to rapidly replicate existing technologies, optimise them, and ultimately deliver cheaper, highly scalable business models. We’re already seeing this play out in AI.

DeepSeek is the first major example of this strategy in action, a homegrown AI startup that has quickly gained traction by offering high-performance models at a fraction of Western costs. It’s a signal of what’s likely to come: China will keep backing companies that can reproduce key technologies, improve efficiency, and make them widely accessible across its domestic market.