Guotai Junan: Huawei's computing acceleration iteration brings continuous benefits to related manufacturers.

Guotai Junan Securities released a research report stating that Xu Zhijun, the rotating chairman of Huawei, said that as of September 2024, more than 6 million developers and 7600 partners have joined the Kunpeng and Ascend computing ecosystem, jointly developing over 20,000 industry solutions. In the future, Huawei will continue to invest in promoting the development of its computing ecosystem. The rapid development of Huawei's computing ecosystem is expected to benefit related vendors. In addition, the launch of HarmonyOS for PCs will complement Huawei's smart IoT ecosystem and is expected to further drive the development of the HarmonyOS ecosystem beyond expectations. By innovating its architecture, Huawei provides sustainable computing solutions to its partners. From September 19 to 21, 2024, the Huawei Full Connection Conference was held in Shanghai, showcasing the latest progress in Huawei's computing ecosystem. At the base level of computing power, Xu Zhijun, the rotating chairman of Huawei, stated that sustainable computing power is only achievable based on chip manufacturing processes available domestically, as the semiconductor manufacturing technology in China remains relatively behind for an extended period of time. This has led to performance gaps in single-chip computing power compared to overseas products. Therefore, Huawei is striving to promote computing architecture innovation through the "super node+cluster" approach to provide customers with system-level computing power that meets their needs and ensure the sustainable development of Huawei's computing ecosystem. As of September 2024, more than 6 million developers and 7600 partners have joined the Kunpeng and Ascend computing ecosystem, jointly developing over 20,000 industry solutions, and Huawei will continue to invest in promoting the development of its computing ecosystem. The open Euler and open Gauss ecosystems continue to thrive, becoming core participants in the Chinese market. According to third-party statistics cited at the Huawei Full Connection Conference, in 2023, the openEuler operating system had a market share of 36.8% in new server operating systems in China, making it the top server operating system by market share. With over 3.5 million global deployments in over 150 countries, openEuler is serving customers worldwide. In 2023, the openGauss database had a market share of 21.9% among centralized relational databases deployed locally in China, ranking at the top, and is expected to further increase to 30% in 2024. With the continuous release of new versions of openEuler and openGauss, they will further meet the requirements of AI heterogeneous computing for basic software. It is expected that their market influence in key industries such as government, finance, telecommunications, and electricity will continue to grow, benefiting related distribution vendors. The rapid growth of the HarmonyOS ecosystem is expected to exceed expectations. HarmonyOS is a full-scene distributed intelligent operating system, and the upcoming HarmonyOS NEXT, expected to be officially released by the end of this year, adopts a new system architecture and a new distributed software bus, increasing overall performance by 30% and improving application cross-device transfer speed by 3 times while reducing power consumption by 20%. As of September 2024, over 10,000 native HarmonyOS apps and services have been launched, covering users' needs in various scenarios such as life, finance, consumption, office, and entertainment, with an expected 100,000 completed launches by October. Regarding the types of terminals covered, according to a report by Caijing on September 20, Huawei's Executive Director Yu Chengdong stated that Huawei's PCs may be the last batch of laptops with Windows operating systems, with future PC products using HarmonyOS. Guotai Junan Securities believes that the launch of HarmonyOS for PCs will complement Huawei's smart IoT ecosystem and is expected to further drive the HarmonyOS ecosystem beyond expectations.