Preface:

At the dawn of 2025, the global capital market is poised to witness a fresh surge of growth, propelled by the relentless wave of technological innovation. China's A-share market, with the technology sector serving as its cornerstone, is demonstrating robust capital-attracting prowess.

From the strategic repositioning of public funds to the burgeoning investments from private capital, from the windfall of policy dividends to the epochal technological breakthroughs, the structural dynamics within the technology sector are redefining the investment landscape.

Author | Fang Wensan

Image Source | Network

AI Computing Power Infrastructure: The "Digital Backbone" of Capital Competition

Fueled by the evolution of generative AI and the iteration of large models, the demand for computing power is experiencing exponential growth. In 2025, the global "arms race" for AI computing power infrastructure will reach a fever pitch.

According to CITIC Securities' research report, the capital expenditure growth rate of the four major North American cloud vendors surpassed 50% in 2024, while the domestic self-reliance in the computing power supply chain is also gathering momentum.

Technological advancements by companies such as SMIC and Cambricon in chip design and manufacturing have accelerated the commercialization of domestic GPUs and AI accelerators.

Public funds' fourth-quarter reports reveal that numerous fund managers consider computing power as a pivotal allocation direction. For instance, Jin Zicai of Caitong Fund bolstered its allocation to domestic computing power targets in the fourth quarter of 2024, believing that "the domestic competition for AI capital expenditure has just commenced and is anticipated to mirror the growth trajectory of overseas computing power".

Moreover, the construction of smart computing centers has emerged as a policy priority, with numerous local governments collaborating with technology firms to initiate ultra-large-scale computing power cluster projects. It is estimated that the investment scale of domestic smart computing centers will exceed 100 billion yuan in 2025.

Computing power stands as the "electricity, water, and gas" of the AI era, benefiting from the dual tailwinds of policy support and technological iteration. Focus on domestic computing power chips (e.g., Huawei Ascend, Hygon), data center (AIDC) operators, and supporting equipment suppliers.

AI Application and Data Industry Chain: Bridging the "Last Mile" from Technology to Commerce

If computing power serves as the infrastructure of AI, then application implementation is the culmination of realizing its value. 2025 is heralded as the "first year of AI Agents," with OpenAI's Operator system, Google's Gemini 2.0 model, and China's DeepSeek large model marking the transition of AI from a single-purpose tool to a multi-task agent.

These technological milestones have fostered commercial applications in diverse fields such as office automation, medical diagnosis, and financial analysis.

In terms of capital flows, AI application layer enterprises exhibit a notable money-attracting prowess. In 2024, global financing in the AI sector reached $99.1 billion, with leading enterprises like OpenAI surpassing a valuation of $150 billion, and startups such as xAI and Cognition AI swiftly joining the unicorn club.

Domestically, vertical tracks like AI+healthcare and AI+education have sprouted with a plethora of high-growth enterprises. For example, AI protein design company Xaira Therapeutics boasts a valuation exceeding $2.7 billion.

Prioritize the deployment in enterprises with vertical scenario implementation capabilities, particularly those with exceptional data governance capabilities. For instance, AI+office software (e.g., Kingsoft Office), AI+medical imaging (e.g., United Imaging Healthcare), and data annotation.

AI Terminal Hardware Innovation: The "Edge Revolution" Encompassing Phones to Robots

The intelligent upgradation of terminal hardware constitutes another primary theme of technology investment in 2025. With the enhancement of edge computing power, AI phones, autonomous vehicles, and humanoid robots have become the focal points of capital pursuit.

AI Phones: In the first quarter of 2025, manufacturers such as Huawei and Xiaomi launched AI phones equipped with edge-side large models, supporting functionalities like real-time translation and image generation. CITIC Securities forecasts that the penetration rate of AI phones will reach 30% by the end of 2025, driving demand in the industrial chain for storage chips, sensors, etc.

Autonomous Driving: Tesla, XPeng, and other automakers are accelerating the advancement of L4 autonomous driving technology, with end-to-end algorithms significantly enhancing the intelligent driving experience. Chip manufacturers such as NVIDIA and Horizon Robotics have witnessed a surge in orders for their in-vehicle computing platforms.

Humanoid Robots: Products from UBTech and Tesla Optimus are on the cusp of mass production. The fusion of AI and mechanical control is driving down costs, and it is anticipated that the global market size for humanoid robots will exceed $10 billion in 2025.

Semiconductors/Chips: The Nexus of Domestic Substitution and Global Competition

The semiconductor sector exhibited signs of robust recovery towards the end of 2024. In December 2024, the net inflow of main funds in the chip concept sector reached 9.5 billion yuan, with SMIC, Cambricon, and other stocks ranking among the top gainers.

In 2025, amidst the surge in global demand for AI computing power and the deepening of domestic substitution policies, the semiconductor industry chain will embark on a new cycle of prosperity.

Memory Chips: Samsung and SK Hynix are expanding HBM (High Bandwidth Memory) production, while domestic Yangtze Memory is accelerating breakthroughs in 3D NAND technology.

Equipment Localization: The US export restrictions on semiconductors to China are compelling domestic equipment companies to accelerate innovation, with Northern Huachuang and AMEC achieving significant order growth in the fields of etching and deposition equipment.

Consumer Technology Integration: The "Cost-Effectiveness Revolution" Amidst New Formats

The boundaries between technology and consumption are increasingly blurring. In 2025, tracks such as consumer electronics and smart homes are regaining capital favor due to technological innovation and business model transformations.

For instance, breakthroughs in function integration and cost control of sweeping robots and AR/VR devices are propelling "cost-effective consumption" to become the prevailing trend.

China Universal Asset Management asserts that the excess returns in the consumer sector will emanate from "new business models," such as the integration of live streaming e-commerce and AI recommendation algorithms, and personalized services for smart home appliances. Additionally, light industry export enterprises are emerging as a new engine for foreign trade growth through digital transformation to enhance efficiency.

Conclusion:

Technology investment in 2025 is fundamentally a wager on the future. Whether it be the underlying foundation of AI computing power or the scenario revolution of terminal applications, capital choices invariably revolve around the dual paradigm of "technological breakthrough + commercial implementation." For investors, only by meticulously exploring industry trends and striking a balance between valuation and growth can they seize an edge in this technology bonanza.

Content Reference Sources: Interpretation of the Fourth-Quarter Reports of Public Funds: The Long-Term Value of Technology and Consumption; Capital Frenzy and Risk Warnings of Generative AI; Year-End Market of Semiconductor Sector and Opportunities for Domestic Substitution; CITIC Securities' 2025 Technology Investment Strategy