Business
Stellantis Reports 7% Growth in Q3 2023 Net Revenues, Driven by Continued Strength in Shipments Year-Over-Year
Published
3 years agoon
In an industry still affected by unprecedented disruptions and transformations, Stellantis and its dealer network in Europe have strengthened their partnership to improve customer experience and streamline the overall customer journey
AMSTERDAM, Netherlands, November 1, 2023/APO Group/ —
Net revenues of €45.1 billion, up 7% compared to Q3 2022, mainly reflecting improved volume and consistent pricing, partially offset by foreign exchange impacts; Consolidated shipments(1) of 1,427 thousand units, up 11% versus Q3 2022, with Enlarged Europe, Middle East & Africa, North America and South America reporting year-over-year improvements; Total new vehicle inventory of 1,387 thousand units at September 30, 2023. Company inventory of 388 thousand units, up 158 thousand units from December 31, 2022 reflecting a return to more normal levels after a multi-year period of materially-constrained supplies; Tentative agreement reached with both UAW and Unifor. Work stoppages negatively impacted Net revenues by approximately €3 billion, compared to planned production, through October; Global BEV sales up 37% versus Q3 2022 mainly driven by the Jeep® Avenger and growing commercial BEV vehicles sales led by the Citroën ë-Berlingo; The Company repurchased €0.5 billion in shares during Q3 2023. During the nine months ended September 30, 2023, €1.2 billion in shares were repurchased. The Company expects to complete the announced €1.5 billion 2023 Share Buyback Program during Q4 2023. “In the first half of this year, Stellantis (www.Stellantis.com) emerged as the industry leader for AOI, AOI margin, and Industrial Free Cash Flows among its comparable peers. Today, we are focused on maintaining our momentum by delivering industry-leading profitability and cash flows, addressing critical near-term industry challenges, and continuing our electrification and technology transformation. This growth is propelling the execution of our Dare Forward 2030 strategy”: Natalie Knight, CFO.
Stellantis N.V. continued to build momentum in Q3 2023, delivering a 7% year-over-year increase of Net revenues driven by continued strength in shipments. The Company’s “Third Engine”(5) achieved 25% revenue growth year-over-year. Global BEV sales were up 37% versus third quarter 2022, led by the following vehicles: Jeep® Avenger, Citroën Ami, Peugeot E-208, Fiat New 500e, and Citroën ë-Berlingo. Key activities executed to achieve the Dare Forward 2030 strategic plan include:
Care: In an industry still affected by unprecedented disruptions and transformations, Stellantis and its dealer network in Europe have strengthened their partnership to improve customer experience and streamline the overall customer journey. With the signing of over 8,000 sales and 25,000 aftersales contracts across 10 strategic European countries, it is clear that Stellantis and its business partners share the same goals when it comes to simplification, multi-brand approach, customer centricity, and quality assurance. Austria, Belgium, Luxembourg, and Netherlands have already adopted the new contracts, with the rest of Europe to begin adopting the new model starting in 2024.
Tech: Peugeot revealed the first application of STLA Medium – the first of Stellantis’ four global BEV-by-design platforms – with the new E-3008, offering a best-in-class range of up to 700 km, charging time, performance, efficiency, and driving pleasure. Fiat returned to the B-segment, leading the way for sustainable urban mobility, with the new 600e, which boasts state-of-the-art safety features and an electric range of more than 400km (WLTP(6) combined cycle) and more than 600 km (WLTP(6) urban cycle) in the city. Fiat also unveiled the new Topolino micro-mobility offer with a 75km range and a safe top speed of 45 km/h. The Company also announced the start of all-electric van production at Ellesmere Port – the UK’s first EV-only volume manufacturing plant – and the first Stellantis plant globally dedicated to electric vehicles.
Coming to the market soon is the all-electric Citroën ë-C3. The first affordable European electric car, the ë-C3 delivers best-in-class comfort, and easy electric life thanks to a 44kWh battery pack providing up to 320km (199 miles) WLTP(6) driving range, at fair and net prices in many European markets, starting at €23,300.
Stellantis celebrated the opening of its state-of-the-art Battery Technology Center at the Mirafiori complex in Turin, Italy. The center enhances the Company’s capabilities to design, develop and test battery packs, modules, high-voltage cells, and software to power upcoming Stellantis brand vehicles.
The Company continued to strengthen its global electrification ecosystem and support its carbon neutrality ambitions: (i) concluding testing with Aramco on the compatibility of 24 engine families to use advanced drop-in eFuels, which will lower CO2 emissions of a potential 28 million Stellantis vehicles currently on the road; (ii) unveiling with Saft the Intelligent Battery Integrated System, which the project team intends to make commercially available on Stellantis vehicles before the end of this decade; (iii) announcing plans for a sixth gigafactory globally to support its bold electrification plan of securing approximately 400 GWh of battery capacity; it will be the second facility to be built in the U.S. with Samsung SDI; (iv) investing in Controlled Thermal Resources Holdings Inc.’s Hell’s Kitchen project to produce up to 300,000 metric tons of lithium carbonate equivalent each year; and (v) completing its 33.3% purchase of Symbio, a leader in zero-emission hydrogen mobility to help secure Stellantis’ leadership position in hydrogen-powered vehicles.
Value: To accelerate the transition to electric vehicles in North America, Stellantis and six major global automakers will create an unprecedented charging network installing at least 30,000 high-powered charge points.
Stellantis is also implementing a multifaceted strategy designed to manage and secure the long-term supply of vital microchips, delivering the objectives laid out in Dare Forward 2030. Stellantis’ strategy combines agreements with chip makers for critical semiconductors, purchase of mission-critical parts, and full visibility of future chip needs.
The Company repurchased €0.5 billion in shares during Q3 2023. During the nine months ended September 30, 2023, €1.2 billion in shares were repurchased. The Company expects to complete the announced €1.5 billion 2023 Share Buyback Program during Q4 2023.
In October 2023, the Company announced its plans to acquire approximately 20% of Leapmotor for approximately €1.5 billion and to form Leapmotor International, a 51/49 Stellantis-led joint venture with exclusive rights for the export and sale, as well as manufacturing, of Leapmotor products outside Greater China.
In October 2023, the Company introduced Pro One as the enhanced strategic offensive of its commercial vehicles business to achieve global leadership, encompassing the professional offerings of six iconic brands of Stellantis – Citroën, FIAT Professional, Opel, Peugeot, Ram and Vauxhall, and to support achievement of the Dare Forward 2030 strategic plan targets.
On October 31, 2023 at 2:00 p.m. CET / 9:00 a.m. EDT, a live audio webcast and conference call will be held to present Stellantis’ Third Quarter 2023 Shipments and Revenues. The audio webcast and recorded replay will be accessible under the Investors section of the Stellantis corporate website at www.Stellantis.com. The presentation material is expected to be posted under the Investors section of the Stellantis corporate website at approximately 8:00 a.m. CET / 3:00 a.m. EDT on October 31, 2023.
Upcoming events:
- Full Year 2023 Results – February 15, 2024
- Investor Day 2024, Auburn Hills, Michigan, USA – June 13, 2024
| Q3 2023 | Q3 2022 | Change | FY 2023 GUIDANCE – CONFIRMEDAdjusted Operating Income Margin(2) Double-DigitIndustrial Free Cash Flows(3) Positive€1.5 billion Share Buyback Program On-Track2023 INDUSTRY OUTLOOK(4)*North America +8% (from 5%)Enlarged Europe +10% (from 7%)Middle East & Africa +10% (from 7%)South America Stable (from 3%)India & Asia Pacific +5% (unchanged)China +2% (unchanged)*2023 Industry Outlook changed for NA, EE, MEA and SA compared to outlook provided on Jul 26 ’23 | ||||||
| Combined shipments (000 units) | 1,478 | 1,334 | +11% | ||||||
| Consolidated shipments (000 units) | 1,427 | 1,281 | +11% | ||||||
| Net revenues (€ billion) | 45.1 | 42.1 | +7% | ||||||
| YTD 2023 | YTD 2022 | Change | |||||||
| Combined shipments (000 units) | 4,805 | 4,367 | +10% | ||||||
| Consolidated shipments (000 units) | 4,629 | 4,215 | +10% | ||||||
| Net revenues (€ billion) | 143.5 | 130.1 | +10% | ||||||
____________________________________________________________________________________________________________________________________
All reported data is unaudited. Reference should be made to the section “Safe Harbor Statement” included elsewhere within this document.
Segment Performance
| NORTH AMERICA | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Shipments up 7%, led by Chrysler (in particular Pacifica PHEV) which more than doubled y-o-y; Dodge and Ram also improved; Jeep shipments down due to the discontinued current generation Cherokee and scheduled downtime of the Compass, partially offset by Grand Cherokee which nearly doubledNet revenues up 2%, primarily due to higher volumes, positive net pricing and positive mix, mostly offset by unfavorable FX translation effects | YTD 2023 | YTD 2022 | |||||||
| Shipments (000s) | 470 | 441 | +29 | 1,493 | 1,400 | |||||||
| Net revenues (€ million) | 21,523 | 21,071 | +452 | 67,439 | 63,514 | |||||||
| ENLARGED EUROPE | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Shipments up 11%, driven by increased shipments of Opel/Vauxhall (in particular Astra), Fiat Professional (led by Ducato) and Peugeot (led by 208), as well as increased demand for BEVs, led by Jeep AvengerNet revenues up 5%, mainly due to increased volumes and stable net pricing | YTD 2023 | YTD 2022 | |||||||
| Shipments (000s) | 599 | 538 | +61 | 2,077 | 1,900 | |||||||
| Net revenues (€ million) | 14,124 | 13,486 | +638 | 48,985 | 44,805 | |||||||
| MIDDLE EAST & AFRICA | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Consolidated shipments up 102%, led by robust growth in Fiat shipments; Opel, Peugeot and Citroën models also grew significantly, partially offset by a decrease in Jeep brand shipmentsNet revenues up 128%, primarily due to increased volumes and positive net pricing, partially offset by negative FX translation effects, mainly from Turkish lira | YTD 2023 | YTD 2022 | |||||||
| Combined shipments (000s)(1) | 139 | 87 | +52 | 440 | 286 | |||||||
| Consolidated shipments (000s)(1) | 105 | 52 | +53 | 313 | 190 | |||||||
| Net revenues (€ million) | 3,021 | 1,324 | +1,697 | 7,719 | 4,363 | |||||||
| SOUTH AMERICA | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Shipments up 7%, due to higher Fiat volumes (led by Fastback), Fiat Professional, Peugeot and Ram shipmentsNet revenues up 8%, mainly due to increased volumes and favorable net pricing, partially offset by negative FX translation effects, mostly Argentinian peso | YTD 2023 | YTD 2022 | |||||||
| Shipments (000s) | 227 | 213 | +14 | 647 | 616 | |||||||
| Net revenues (€ million) | 4,285 | 3,965 | +320 | 11,848 | 11,198 | |||||||
| CHINA AND INDIA & ASIA PACIFIC | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Consolidated shipments down 33%, due to decreased shipments of Jeep and Peugeot; mitigated by increased Alfa Romeo (due to all-new Tonale)Net revenues down 38%, mainly due to decreased volumes and negative FX translation effects | YTD 2023 | YTD 2022 | |||||||
| Combined shipments (000s)(1) | 37 | 48 | (11) | 127 | 148 | |||||||
| Consolidated shipments (000s)(1) | 20 | 30 | (10) | 78 | 92 | |||||||
| Net revenues (€ million) | 705 | 1,138 | (433) | 2,691 | 3,290 | |||||||
| MASERATI | ||||||||||||
| Q3 2023 | Q3 2022 | Change | Shipments down 20%, due to lower volumes in China; Levante and Ghibli shipments down, partially offset by higher Grecale volumesNet revenues down 21%, primarily due to decreased volumes and unfavorable FX translation effects | YTD 2023 | YTD 2022 | |||||||
| Shipments (000s) | 5.3 | 6.6 | (1.3) | 20.6 | 16.8 | |||||||
| Net revenues (€ million) | 496 | 630 | (134) | 1,805 | 1,571 | |||||||
Reconciliations
Net revenues from external customers to Net revenues
| Q3 2023 | (€ million) | NORTH AMERICA | ENLARGED EUROPE | MIDDLE EAST & AFRICA | SOUTH AMERICA | CHINA AND INDIA & ASIA PACIFIC | MASERATI | OTHER(*) | STELLANTIS | ||||||||
| Net revenues from external customers | 21,522 | 14,077 | 3,022 | 4,320 | 705 | 495 | 995 | 45,136 | |||||||||
| Net revenues from transactions with other segments | 1 | 47 | (1) | (35) | — | 1 | (13) | — | |||||||||
| Net revenues | 21,523 | 14,124 | 3,021 | 4,285 | 705 | 496 | 982 | 45,136 | |||||||||
___________________________________________________________________________________________________________________
(*) Other activities, unallocated items and eliminations
| Q3 2022 | (€ million) | NORTH AMERICA | ENLARGED EUROPE | MIDDLE EAST & AFRICA | SOUTH AMERICA | CHINA AND INDIA & ASIA PACIFIC | MASERATI | OTHER(*) | STELLANTIS | ||||||||
| Net revenues from external customers | 21,070 | 13,467 | 1,324 | 3,978 | 1,136 | 631 | 495 | 42,101 | |||||||||
| Net revenues from transactions with other segments | 1 | 19 | — | (13) | 2 | (1) | (8) | — | |||||||||
| Net revenues | 21,071 | 13,486 | 1,324 | 3,965 | 1,138 | 630 | 487 | 42,101 | |||||||||
___________________________________________________________________________________________________________________
(*) Other activities, unallocated items and eliminations
| YTD 2023 | (€ million) | NORTH AMERICA | ENLARGED EUROPE | MIDDLE EAST & AFRICA | SOUTH AMERICA | CHINA AND INDIA & ASIA PACIFIC | MASERATI | OTHER(*) | STELLANTIS | ||||||||
| Net revenues from external customers | 67,438 | 48,888 | 7,720 | 11,929 | 2,690 | 1,805 | 3,034 | 143,504 | |||||||||
| Net revenues from transactions with other segments | 1 | 97 | (1) | (81) | 1 | — | (17) | — | |||||||||
| Net revenues | 67,439 | 48,985 | 7,719 | 11,848 | 2,691 | 1,805 | 3,017 | 143,504 | |||||||||
___________________________________________________________________________________________________________________
(*) Other activities, unallocated items and eliminations
| YTD 2022 | (€ million) | NORTH AMERICA | ENLARGED EUROPE | MIDDLE EAST & AFRICA | SOUTH AMERICA | CHINA AND INDIA & ASIA PACIFIC | MASERATI | OTHER(*) | STELLANTIS | ||||||||
| Net revenues from external customers | 63,512 | 44,742 | 4,363 | 11,211 | 3,286 | 1,574 | 1,412 | 130,100 | |||||||||
| Net revenues from transactions with other segments | 2 | 63 | — | (13) | 4 | (3) | (53) | — | |||||||||
| Net revenues | 63,514 | 44,805 | 4,363 | 11,198 | 3,290 | 1,571 | 1,359 | 130,100 | |||||||||
______________________________________________________________________________________
(*) Other activities, unallocated items and eliminations
Rankings, market share and other industry information are derived from third-party industry sources (e.g. Agence Nationale des Titres Sécurisés (ANTS), Associação Nacional dos Fabricantes de Veículos Automotores (ANFAVEA), Ministry of Infrastructure and Sustainable Mobility (MIMS), Ward’s Automotive) and internal information unless otherwise stated.
For purposes of this document, and unless otherwise stated industry and market share information are for passenger cars (PC) plus light commercial vehicles (LCV), except as noted below:
- Middle East & Africa exclude Iran, Sudan and Syria;
- South America excludes Cuba;
- India & Asia Pacific reflects aggregate for major markets where Stellantis competes (Japan (PC), India (PC), South Korea (PC + Pickups), Australia, New Zealand and South East Asia);
- China represents PC only; and
- Maserati reflects aggregate for 17 major markets where Maserati competes and is derived from S&P Global data, Maserati competitive segment and internal information.
Prior period figures have been updated to reflect current information provided by third-party industry sources.
Commercial Vehicles include vans, light and heavy-duty trucks and passenger vehicles registered or converted for commercial use.
EU30 = EU 27 (excluding Malta), Iceland, Norway, Switzerland and UK.
Low emission vehicles (LEV) = battery electric (BEV), plug-in hybrid (PHEV) and fuel cell electric (FCEV) vehicles.
All Stellantis reported BEV and LEV sales include Citroën Ami and Opel Rocks-e; in countries where these vehicles are classified as quadricycles, they are excluded from Stellantis reported combined sales, industry sales and market share figures.
Safe Harbor Statement
This document, in particular references to “FY 2023 Guidance”, contains forward looking statements. In particular, statements regarding future financial performance and the Company’s expectations as to the achievement of certain targeted metrics, including revenues, industrial free cash flows, vehicle shipments, capital investments, research and development costs and other expenses at any future date or for any future period are forward-looking statements. These statements may include terms such as “may”, “will”, “expect”, “could”, “should”, “intend”, “estimate”, “anticipate”, “believe”, “remain”, “on track”, “design”, “target”, “objective”, “goal”, “forecast”, “projection”, “outlook”, “prospects”, “plan”, or similar terms. Forward-looking statements are not guarantees of future performance. Rather, they are based on the Company’s current state of knowledge, future expectations and projections about future events and are by their nature, subject to inherent risks and uncertainties. They relate to events and depend on circumstances that may or may not occur or exist in the future and, as such, undue reliance should not be placed on them.
Actual results may differ materially from those expressed in forward-looking statements as a result of a variety of factors, including: the Company’s ability to launch new products successfully and to maintain vehicle shipment volumes; changes in the global financial markets, general economic environment and changes in demand for automotive products, which is subject to cyclicality; the Company’s ability to realize the anticipated benefits of the merger; the Company’s ability to offer innovative, attractive products and to develop, manufacture and sell vehicles with advanced features including enhanced electrification, connectivity and autonomous-driving characteristics; the continued impact of unfilled semiconductor orders; the Company’s ability to successfully manage the industry-wide transition from internal combustion engines to full electrification; the Company’s ability to produce or procure electric batteries with competitive performance, cost and at required volumes; a significant malfunction, disruption or security breach compromising information technology systems or the electronic control systems contained in the Company’s vehicles; exchange rate fluctuations, interest rate changes, credit risk and other market risks; increases in costs, disruptions of supply or shortages of raw materials, parts, components and systems used in the Company’s vehicles; changes in local economic and political conditions; changes in trade policy, the imposition of global and regional tariffs or tariffs targeted to the automotive industry, the enactment of tax reforms or other changes in tax laws and regulations; the level of government economic incentives available to support the adoption of battery electric vehicles; various types of claims, lawsuits, governmental investigations and other contingencies, including product liability and warranty claims and environmental claims, investigations and lawsuits; material operating expenditures in relation to compliance with environmental, health and safety regulations; the level of competition in the automotive industry, which may increase due to consolidation and new entrants; the Company’s ability to attract and retain experienced management and employees; exposure to shortfalls in the funding of the Company’s defined benefit pension plans; the Company’s ability to provide or arrange for access to adequate financing for dealers and retail customers and associated risks related to the establishment and operations of financial services companies; the Company’s ability to access funding to execute its business plan; the Company’s ability to realize anticipated benefits from joint venture arrangements; disruptions arising from political, social and economic instability; risks associated with the Company’s relationships with employees, dealers and suppliers; the Company’s ability to maintain effective internal controls over financial reporting; developments in labor and industrial relations and developments in applicable labor laws; earthquakes or other disasters; and other risks and uncertainties.
Any forward-looking statements contained in this document speak only as of the date of this document and the Company disclaims any obligation to update or revise publicly forward-looking statements. Further information concerning the Company and its businesses, including factors that could materially affect the Company’s financial results, is included in the Company’s reports and filings with the U.S. Securities and Exchange Commission and AFM.
_________________________________________
Notes:
(1) Combined shipments include shipments by Company’s consolidated subsidiaries and unconsolidated joint ventures, whereas Consolidated shipments only include shipments by Company’s consolidated subsidiaries. Figures by segments may not add up due to rounding.
(2) Adjusted operating income/(loss) excludes from Net profit/(loss) adjustments comprising restructuring, impairments, asset write-offs, disposals of investments and unusual operating income/(expense) that are considered rare or discrete events and are infrequent in nature, as inclusion of such items is not considered to be indicative of the Company’s ongoing operating performance, and also excludes Net financial expenses/(income) and Tax expense/(benefit). Effective from January 1, 2023, our Adjusted operating income/(loss) includes Share of the profit/(loss) of equity method investees. The comparatives for the respective periods for 2022 have been adjusted accordingly.
This change was implemented as management believes these results are becoming increasingly relevant due to the number of partnerships Stellantis has recently engaged in, and will continue to engage in in the future, around electrification and other areas critical to the future of mobility.
Unusual operating income/(expense) are impacts from strategic decisions, as well as events considered rare or discrete and infrequent in nature, as inclusion of such items is not considered to be indicative of the Company’s ongoing operating performance. Unusual operating income/(expense) includes, but may not be limited to: impacts from strategic decisions to rationalize Stellantis’ core operations; facility-related costs stemming from Stellantis’ plans to match production capacity and cost structure to market demand, and convergence and integration costs directly related to significant acquisitions or mergers.
(3) Industrial free cash flows is calculated as Cash flows from operating activities less: cash flows from operating activities from discontinued operations; cash flows from operating activities related to financial services, net of eliminations; investments in property, plant and equipment and intangible assets for industrial activities; contributions of equity to joint ventures and minor acquisitions of consolidated subsidiaries and equity method and other investments; and adjusted for: net intercompany payments between continuing operations and discontinued operations; proceeds from disposal of assets and contributions to defined benefit pension plans, net of tax. The timing of Industrial free cash flows may be affected by the timing of monetization of receivables, factoring and the payment of accounts payables, as well as changes in other components of working capital, which can vary from period to period due to, among other things, cash management initiatives and other factors, some of which may be outside of the Company’s control.
(4) Source: IHS Global Insight, Wards, China Passenger Car Association and Company estimates
(5) Refers to the aggregation of the South America, Middle East & Africa and China and India & Asia Pacific segments for presentation purposes only
(6) Worldwide Harmonized Light Vehicles Test Cycle
Distributed by APO Group on behalf of Stellantis.
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- Open ecosystems: Huawei is actively building out open computing ecosystems. To date, the Kunpeng ecosystem has attracted 4.16 million developers from around the world. CANN has moved to sustained, community-driven open-source development. Ascend now spans over 90 leading third-party open-source projects and is officially supported as a PyTorch accelerator backend.
SHANGHAI, CHINA – Media OutReach Newswire – 17 September 2026 – HUAWEI CONNECT 2026 kicked off today in Shanghai. The first keynote of the date was by David Wang, the Deputy Chairman of the Board and Rotating Chairman at Huawei. In his speech (Advancing the Agentic World, Building a Solid Silicon Foundation), Wang highlighted the work the company is doing alongside industry stakeholders to build powerful AI infrastructure, lay a solid computing foundation, and address the challenges and opportunities in the intelligent world to come.
AI is sweeping the world faster than any previous technological revolution. Today, foundation model parameters are rapidly approaching 10 trillion, and are projected to exceed 100 trillion by 2030. AI agents can now work on the same task continuously, for hours on end. By 2030, they will be able to handle tasks that span months.
In China alone, the average number of inference tokens consumed every day has surged to around 500 trillion, and is expected to reach quintillions (1018) by 2030.
On-device AI is also advancing rapidly. On-device models for smartphones have expanded from three billion parameters in 2024 to 30 billion today, and will push toward hundreds of billions in the near future.
These trends will set a much higher bar for the scale, performance, and reliability of underlying technical systems. Only by building powerful AI infrastructure can the industry lay a solid foundation for the future intelligent world.
An intelligent world is approaching – and faster than ever. To lead the charge into this new world, Huawei is laser-focused on building out AI infrastructure – the silicon foundation for the future to come.
In particular, Huawei’s AI strategy is centered on computing power, with a focus on monetizing hardware. The company is also sharpening its competitive edge through systems and architectural innovation. Centering these efforts on SuperPoDs and SuperClusters, the company aims to build a solid computing foundation and offer a new option for the world.
Huawei is a major contributor to open computing ecosystems, and will continue to support native training for mainstream foundation models on its systems, as well as supporting a vast range of models and applications.
For customers, Huawei provides flexible on-premises and cloud compute solutions for its customers to accelerate intelligent transformation across industries.
With diverse forms of compute, including solutions for micro-, low-tier, mid-range, and massive computing power – Huawei is driving the expansion of on-device and in-vehicle AI, making intelligence truly ubiquitous.
Additionally, Huawei is dedicated to building next-generation communications networks to bring readily available compute and intelligence to every person, home, and organization.
SuperPoDs gain broad consensus, with adoption growing in industries, academia, and research institutes
To date, over 1,000 Atlas 900 A3 SuperPoDs have been deployed, and Atlas 950 SuperPoD is seeing large-scale commercial use. While adoption continues to grow, SuperPoDs have gained broad acceptance across industry, academia, and research institutions as a key direction for AI infrastructure. Currently, a SuperPoD is explicitly defined as a computing system in which multiple computing nodes are tightly coupled through high-speed interconnect protocols, featuring unified memory addressing across physical nodes — functioning like a single logical computer.
SuperPoDs are the go-to choice for AI infrastructure buildout. Right now, 100k-NPU computing clusters have become the baseline for training SOTA models. However, traditional server architectures result in intra-cluster communications that account for over 40% of total training time, severely constraining Model FLOPs Utilization (MFU). Simulation results from Huawei’s Markov Lab show that a 100k-NPU cluster built with 4k-NPU SuperPoDs can deliver a 2.75x increase in MFU compared to a 100k-NPU cluster composed of 8-NPU servers.
11-chip UnifiedBus-powered portfolio for SuperPoDs and SuperClusters; the Atlas 960E SuperPoD –the industry’s first to use NPO
The Ascend series of chips is the most critical component in Huawei’s 11-chip UnifiedBus-powered portfolio for SuperPoDs and SuperClusters. Development on Ascend 960 has exceeded the company’s expectations, with performance doubling as planned. Ascend 960DT will be available in Q1 2027, three quarters ahead of the company’s original roadmap. And the Ascend 960PR will be ready in Q3 2027, one quarter ahead of schedule.
“We’re evolving our Ascend chip series on a one-generation-a-year cycle,” said Wang in his keynote. “In 2028 and 2029, we will roll out the Ascend 970 and 980 chips, respectively. Thanks to the Tau (τ) Scaling Law, not only will their compute specifications continue to double, but you can also expect to see huge improvements across the board in terms of memory bandwidth, memory capacity, interconnect bandwidth, and more.”
In addition to Ascend chips, Huawei has also developed a complete portfolio of chips for AI infrastructure, based on UnifiedBus, delivering key capabilities that cover computing, interconnect, storage, and management.
“SuperPoDs are designed to coordinate multiple NPUs through interconnect,” continued Wang. “We have developed a next-generation optical interconnect product based on near-packaged optics (NPO): the High-density Optical-interconnect-Node Engine (Hi-ONE).” Built on Huawei’s proprietary technologies, Hi-ONE has a multi-physics design for balancing optical, mechanical, electrical, electromagnetic, and thermal performance, realizing a transmission capacity of 7.2 Tbit/s per single engine.
“This is the industry’s first NPO product ready for mass production, delivering the largest transmission capacity. It is also the industry’s first NPO product with a built-in light source.”
This product combines high bandwidth and high reliability with low latency and low power consumption. This, coupled with UnifiedBus, will make it far easier to scale up SuperPoD interconnect systems.
Recently, Huawei submitted an implementation agreement (IA) on NPO to the Optical Internetworking Forum (OIF), a standards organization. The response from numerous industry partners has been widely positive. Huawei will continue its efforts to further refine the NPO industry ecosystem.
Using Ascend 960 chips and Hi-ONE, Huawei has developed the industry’s first NPO-based SuperPoDs: the Atlas 960E SuperPoDs. A single Atlas 960E SuperPoD can scale up to 4,096 NPUs, delivering 8 EFLOPS of FP8 compute performance, with up to 1 petabyte of HBM capacity. With 5,500 Hi-ONE units, this SuperPoD doesn’t need the 48,000 800G optical modules that would traditionally be required to connect all the NPUs. This cuts power consumption by over 550 kilowatts, while doubling the system’s fault-free operating time, achieving 99.8% system availability.
Combining the upgraded TaiShan 950 SuperPoD and context memory storage to power an ultrascale cluster with 1 million NPUs
As SOTA models scale to 10 trillion parameters, training and inference can no longer rely on a single AI server or AI SuperPoD – they require a more complex computing system. This system includes AI SuperPoDs, general-purpose SuperPoDs, and an interconnect system that features peer-to-peer interconnect and zero protocol conversion. For inference, including a petabyte-scale KV cache cluster is also a must.
To meet these demands, Huawei has fully upgraded its TaiShan 950 SuperPoD. Powered by UnifiedBus all-optical networking, this new SuperPoD supports up to 4,096 nodes with a unified memory pool of up to 256 TB. This setup significantly improves agent performance. For sandbox-intensive workloads, startup speeds for 100,000 sandboxes are 30 times faster than traditional servers, and sandbox density can be improved by an additional 25%. For vector search across 10 billion x 1,000-dimensional vectors, this SuperPoD delivers twice the search efficiency of traditional servers.
Huawei has also launched OceanStor M900 – a UnifiedBus-powered context memory storage cluster that delivers multi-tier KV caching for agent-heavy and longer-context workloads. Designed for agentic inference, this cluster supports one-hop direct access and provides a petabyte-scale KV cache for the L3.5 layer. OceanStor M900 also uses hybrid media and an optimized retention algorithm, extending SSD read/write lifespan by 16-fold. This ensures a higher KV cache hit rate alongside long-term stability and reliability from the ground up.
Combining its strengths in computing and communications, Huawei has built a brand-new agentic SuperCluster to accelerate training and inference for 10-trillion-parameter models. This SuperCluster uses UnifiedBus to consolidate multiple interconnect protocols into a single unified protocol, significantly reducing protocol conversion overhead. This delivers peer-to-peer interconnect between subsystems like Ascend SuperPoDs, Kunpeng SuperPoDs, and KV cache clusters. The SuperCluster also comes with a multi-tier, high-bandwidth, and large-capacity storage system that enables direct single-hop access for all KV cache tiers.
With a two-tier, four-plane Clos architecture, the SuperCluster can interconnect up to 512,000 NPUs. When combined with a multi-rail topology, this cluster can support up to one million NPUs.
One of Huawei’s core strategies: Going open source and open system to build out computing ecosystems
The Kunpeng ecosystem is driving digital and intelligent innovation across a wide range of industries. To date, the Kunpeng ecosystem has attracted over 4.16 million developers and more than 7,200 ecosystem partners from around the globe. The community currently supports over 560 open-source projects worldwide. openEuler has seen more than 20 million installations, securing the largest share in China’s server OS market.
The Ascend ecosystem has reached a new inflection point. The Compute Architecture for Neural Networks (CANN) is the foundation of the Ascend ecosystem. Today, CANN has moved to sustained, community-driven open-source development, which has brought the platform from usable to user-friendly.
External CANN developers now comprise 61% of all CANN developers, outnumbering internal developers for the first time. With over 5,200 monthly active developers, the CANN community has become the most vibrant open-source community in China. What’s more, over 40 models have been natively pre-trained on Ascend and CANN, making it the only proven domestic stack capable of model pre-training.
Ascend now supports over 90 leading third-party open-source projects, including PyTorch, Triton, vLLM, and veRL. With strong support from the Linux Foundation, Ascend is the first official Chinese compute platform on PyTorch’s website. This gives developers around the world ready access to new innovations in the Ascend ecosystem.
Diverse forms of compute for ubiquitous on-device and in-vehicle AI
AI is expanding faster into all kinds of devices. To deliver an unparalleled AI experience across all scenarios, Huawei will continue to strengthen capabilities in four key areas:
First, Huawei will combine Kirin and Ascend chips to drive self-reliance and autonomy in on-device compute.
Second, Huawei will bring together Pangu models and third-party models to make on-device intelligence better and easier to use.
Third, HarmonyOS, as an Agent OS for ubiquitous intelligence, will be completely redefined from the ground up – spanning system architecture, how it operates, and interaction logic – to enable human-agent collaboration.
Fourth, Huawei will keep cultivating a diverse AI ecosystem, which is the foundation for its system agent Celia to thrive.
Huawei plans to build four on-device computing platforms: for AI phones, AI PCs, vehicles, and homes. Through cross-device and device-cloud compute synergy, Huawei will be able to provide distributed swarm intelligence, delivering integrated and continuous intelligent services across personal mobile, office, vehicle, and home spaces, ultimately bringing intelligence to every person and every space.
Building next-generation communications that prioritize readily available compute, because without networks, all compute is siloed
Next-generation communications networks are crucial for fully unleashing the value of AI compute. We are driving the upgrade to networks that, in addition to connecting people, will prioritize delivering readily available compute. These networks will be underpinned by 5G-A/6G, 10-gigabit optical networks, and multi-tier, low-latency bearer networks, delivering intelligent connectivity across data centers, the edge, and devices.
Concluding his keynote, Wang expressed that AI “may well be the final technological revolution in human history,” noting that its impact is deeper and broader, and coming faster than anyone could have ever imagined. “No single company,” he said, “can build an intelligent world alone.”
He stressed Huawei’s ongoing commitments moving forward:
Huawei will remain committed to building a solid silicon foundation to make computing power readily accessible to all.
The company will continue to open source its software, helping developers unleash their full potential.
It will continue to embrace a wide range of models and applications, unlocking value in every form.
“And we will continue to work together to drive shared success, growing together with our customers and partners around the world,” Wang concluded. “Let’s work together to build a fully connected, intelligent world.”
Themed Advancing the Agentic World, HUAWEI CONNECT 2026 will delve into AI across three dimensions: strategy, technology, and ecosystems. You can expect an in-depth look at our latest strategic initiatives, and we’ll also be unveiling our all-new digital and intelligent infrastructure products, scenario-specific solutions for industries, and development tools. The event will run from September 17 to 19 at the Shanghai World Expo Exhibition & Convention Center and Shanghai Expo Center. For more information, please visit HUAWEI CONNECT 2026 online at www.huawei.com/en/events/huaweiconnect
FAQs:
Q1: What is a SuperPoD, and why is it becoming increasingly important?
A SuperPoD is a computing system in which multiple computing nodes are tightly coupled through high-speed interconnect, enabling them to share unified memory and function like a single computer. As foundation model training and inference continue to scale up, SuperPoDs can reduce communications overhead in large-scale clusters and improve Model FLOPs Utilization (MFU). They have gained broad consensus across industry, academia, and research institutes in AI infrastructure, and are the go-to choice for AI infrastructure buildout.
Q2: What makes the Atlas 960E SuperPoDs special?
The Atlas 960E SuperPoD is the industry’s first NPO-based SuperPoD. A single Atlas 960E SuperPoD can scale up to 4,096 NPUs, delivering 8 EFLOPS of FP8 compute performance, with up to 1 petabyte of HBM capacity. With 5,500 Hi-ONE units, this SuperPoD doesn’t need the 48,000 800G optical modules that would traditionally be required to connect all the NPUs. This cuts power consumption by over 550 kilowatts, while doubling the system’s fault-free operating time, achieving 99.8% system availability. Atlas 960E SuperPoDs can provide efficient and reliable computing power for large-scale AI training and inference.
Q3: What is NPO, and what role does Hi-ONE play in a SuperPoD?
NPO stands for Near-Packaged Optics, an optical interconnect technology designed for high-speed connectivity. Hi-ONE, developed by Huawei, is the industry’s first NPO product ready for mass production. It delivers the largest transmission capacity at 7.2 Tbit/s and is currently the industry’s only NPO product with a built-in light source. Hi-ONE, coupled with UnifiedBus, will make it far easier to scale up SuperPoD interconnect systems.
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