China's Nvidia Just Surged 425%--And It's Only Getting Started

China's AI gold rush just minted its newest market sensation. Moore Threads, founded in 2020 by former Nvidia NVDA executive Zhang Jianzhong, staged a blockbuster debut on Shanghai's STAR Market, raising more than $1 billion before soaring more than fivefold in Friday trading. The chipmaker closed at 600.5 yuan and reached a market capitalization of about 282.3 billion yuan, or slightly under $40 billion. Retail demand was electric: individual investor orders exceeded shares available by roughly 2,750 times. Zhang is positioning Moore Threads as a central player in Beijing's mission to reduce dependence on foreign computing power at a moment when Washington has tightened export restrictions targeting advanced AI chips.

China's domestic AI ecosystem has been accelerating since startup DeepSeek released a large language model that rivaled global offerings at significantly lower cost, fueling a surge of capital across local tech giants including Alibaba and Tencent. Moore Threads is the first of China's four little dragons to list, and plans to use its IPO proceeds to expand GPU research, development, and working capital. Analysts note that Chinese AI chips and models still trail foreign platforms in important areas, but the combination of policy support, engineering investment, and soaring investor enthusiasm could help accelerate innovation. Zhang said AI likely isn't in a bubble as long as large language models keep advancing and no major problem-solving bottlenecks appear.

With U.S. markets becoming more cautious about lofty AI valuations, Moore Threads remains valued at only a fraction of Nvidia's nearly $4.5 trillion market cap, giving investors room to imagine future domestic upside if China continues building self-sufficient computing infrastructure. Friday's frenzy may also set the tone for the next wave of semiconductor listings. MetaX, another Shanghai chipmaker and member of the four dragons, is working toward a deal expected to raise the equivalent of more than $550 million. If Beijing's AI policy momentum continues and private capital stays engaged, China's semiconductor IPO window could be one of the most closely watched areas for investors tracking the next phase of AI infrastructure spending.