A.M. Edition for April 28. Huawei is developing a new AI chip that aims to rival high-end offerings from U.S. semiconductor giant Nvidia. WSJ tech reporter Liza Lin says that although Huawei's Ascend 910D chip is still in the early stages of development, it shows the resilience of China’s semiconductor industry. Plus, Canadians head to the polls to decide the country’s next leader amidst economic turbulence and outside pressure from President Trump over trade and security. And elite universities form a private collective to push back against the White House. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What is Huawei's new AI chip about?
With home prices at sky-high levels in many markets, relatively low-priced pockets of America, like Toledo, are seeing a lot more elevated interest. It is one of the sort of hidden gems of housing affordability.
It's Monday, April 28th. I'm Luke Vargas for The Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today. It's almost time for the culmination of earnings season as Microsoft, Meta, Amazon and Apple prepare to report quarterly results in the coming days.
Along with Alphabet, Nvidia and Tesla, those magnificent seven tech stocks were largely responsible for lifting stocks out of the 2022 bear market, but currently they find themselves in a very different situation. So far this year, they've collectively shed $2.5 trillion in market value, with each falling more than 6 percent, and their earnings dominance is expected to diminish.
According to analysts polled by FactSet, the Mag 7 are on pace for just 16 percent profit growth this year, down from about 37 last year. Microsoft and Meta's results are due on Wednesday, with Amazon and Apple following on Thursday. Meanwhile, just months after the emergence of Chinese AI model DeepSeek dented some investors' faith in the supremacy of U.S.
tech, we exclusively report that China's Huawei is developing a new AI chip that aims to rival high-end offerings from U.S. semiconductor giant NVIDIA. And here with more from Singapore is journal tech reporter Lisa Lin. Lisa, this chip, the Ascend 910D, we should note, is still in the early stages of development.
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Chapter 2: How does Huawei's chip aim to rival Nvidia?
A first batch of the processor isn't even set to be delivered until late next month at the earliest. However, I gather the significance here is namely that there's a perceived market opening, thanks to actions by Washington, and that there's a Chinese company making very concrete plans to try to capitalize on this moment.
Yeah, you're right on both counts, Luke. Although I would point out there's a third dimension to this, and it would be good to remind listeners on the background of Huawei.
This Chinese tech company started out as a cell phone and telecom equipment maker, and Washington basically forced their hand and forced them to go all in with designing and producing chips when they cut Huawei off advanced American technology five years ago. They were once big buyers of Qualcomm, Nvidia, Intel chips, and now they have to design, make their own, and now they're even selling it.
And it's a huge addressable market. I mean, the timing really coincides with when US policymakers have made their latest move to try and cut China off the latest advanced US chips. the most recent one being the ban of NVIDIA's H20 chips into China.
The H20 is not seen as the most top-end chip from NVIDIA, but it was the best chip available for sale by an American GPU or AI chipmaker into the country, and now these chips have been cut off. So now you have more willing buyers in China for Huawei chips than there were before.
The road ahead, though, not certain. Far from it, I imagine. Tech promises are not the same as actually delivering on them. What challenges does Huawei have to still overcome to capitalize on this?
The first big one is production. Huawei can design such a fantastic chip, but realistically, can they produce it in the mass quantities needed, both for themselves, for internal use, and for external sales? That is a big question.
Huawei's been cut off from the world's biggest and recognized as the best foundry, TSMC, and the Chinese equivalent of that, SMIC, S-M-I-C, is far from as efficient in terms of production as TSMC is. The next is production. that Huawei's chip design and chip making really still lags Nvidia.
And we know this because sources tell us that in order to produce the 910D, what Huawei did was they used packaging methods to pack what is the equivalent of three to four existing mature chips together to make them more powerful. However, the eventual result is such a chip is a lot more power intensive and power hungry.
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Chapter 3: What challenges does Huawei face in chip production?
jobs report since President Trump's Liberation Day tariff announcements and the scheduled end of the de minimis exemption for shipping lower-value goods to the U.S. from China, which had boosted the fortunes of Xi'an and Temu in recent years. And as if the week wasn't busy enough, we've had a slew of M&A announcements this morning.
Shares of Deliveroo hit a three-year high in London after the food delivery company said it received a more than $3.5 billion takeover approach from DoorDash. Meanwhile, Airbus is taking over key U.S. and European assets from supplier Spirit Aerosystems, which rival Boeing agreed to buy last year.
The carve-out secures crucial parts for Airbus' commercial aircrafts and comes ahead of this week's self-imposed deadline for Boeing to finalize its takeover of Spirit. And we've also had multi-billion dollar deals involving German pharmaceutical company Merck, which is buying Springworks Therapeutics, and between Spanish banks Mediobanca and Banca Generale.
Chapter 4: What is the significance of the U.S.-China tech rivalry?
Check out WSJ.com for more on all of those deals and how investors are reacting. Coming up, Canada heads to the polls in what's set to be a major election upset and a referendum on ties with America, and how buyers are being priced out of the red-hot Midwest housing market. We've got those stories and more after the break.
Americans love using their credit cards, the most secure and hassle-free way to pay. But D.C. politicians want to change that with the Durbin Marshall Credit Card Bill. This bill lets corporate megastores pick how your credit card is processed, allowing them to use untested payment networks that jeopardize your data security and rewards.
Corporate megastores will make more money, and you pay the price. Tell Congress to guard your card, because Americans lose when politicians choose. Learn more at GuardYourCard.com.
Canadians are voting in a general election today to decide who will lead the country amidst the economic uncertainty it faces and negotiate with President Trump over trade and security. Just a few months ago, the Conservative Party, under leader Pierre Polyev, held a more than 20-point polling lead over the governing Liberals.
But that is until Prime Minister Justin Trudeau was replaced by former central bank governor Mark Carney and President Trump announced tariffs. And now the liberals are polling with a three-point lead over the conservatives. We need to fight Trump's tariffs with counter tariffs of our own that cause maximum damage in the United States with minimum impact here.
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Chapter 5: How is the Chinese semiconductor industry evolving?
Polyev, meanwhile, a career politician, has tried to make the election about inflation and housing prices that are among the highest in the world, which he blames on Trudeau's leadership over the last decade.
Mark Carney's plan is to do exactly what Trudeau did on steroids. More spending, more taxes, more soft on crime. We can't afford four more years of the liberals. We need a change.
Over the weekend, both leaders, along with the heads of Canada's other political parties, changed their campaign schedules in light of Saturday's attack in Vancouver, where 11 people were killed and at least 20 injured after a man drove through a crowd at a street festival, according to local police, who said the incident wasn't terrorism.
The suspect was apprehended by bystanders at the scene and charged with eight counts of second-degree murder yesterday, though prosecutors say more charges are possible. Israel's government is under pressure to lift an aid ban on Gaza, with humanitarian supplies there running out after a blockade that's lasted almost two months.
Officials are now debating the best way to get supplies back into the territory without strengthening Hamas. The military reportedly favors working with international organizations that have distributed aid throughout the war, though some far-right officials want Israel to play a greater role in distributing the aid itself, not shying away from perceptions that Israel is an occupying force.
We are exclusively reporting that the leaders of some of the nation's top universities have assembled a private collective to counter the Trump administration's attack on academic independence across higher education.
The group, which includes about 10 schools from Ivy's and leading private research universities, have discussed red lines they won't cross in negotiations, including autonomy over admissions, hiring, and what they teach and how it's taught.
According to a source familiar with the government task force that's issued funding threats to universities, the Trump administration has been worried that schools would team up in resistance because it's harder to negotiate with the United Front. The White House didn't respond Sunday to request for comment.
And the struggle to find a cheap house is transforming America's heartland from one of the last places for lower-priced homes into a battlefield pitting Wall Street landlords against traditional buyers. Toledo, Ohio, is one of those places where housing reporter Rebecca Picciotto says that competition for homes is more cutthroat than ever as interest in the city peaks.
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