On May 25, 2026, He Tingbo, Director of Huawei and President of the Semiconductor Business Unit, formally introduced the Tao (τ) Law at ISCAS 2026. This marks the first time China has proposed a new principle to guide industry development in the global semiconductor sector.
1. τ (tau, pronounced "tao") represents the time constant in circuit theory—the time it takes for a signal to switch from one state to another. The smaller the τ, the faster the circuit switches.
The traditional Moore's Law seeks continuous miniaturization of transistor dimensions (geometric scaling).
Tao's Law转向时间缩微：持续压缩信号传播时延，不依赖极致线宽。
2. Core Implementation Path — Logic Folding
Traditional chip circuit layouts are two-dimensional planes, requiring long-distance horizontal routing for signals. Logic folding extends the circuit layout from a single layer to a multi-layer stack, folding critical paths vertically and stacking them to replace long-distance planar traces with short-distance vertical interconnects, thereby significantly reducing the time constant τ.
3. Existing Achievements and Goals
Over the past six years, Huawei has designed and mass-produced 381 chips compliant with the Tao Law.
Plan to launch the Kirin chip with logic folding technology in autumn 2026.
By 2031, high-end chips based on Tao's Law are expected to reach performance levels equivalent to a 1.4-nanometer process.
The list of companies related to Huawei's Tao Law is summarized below. We recommend liking and saving this for future reference. The information provided is for logical analysis and informational purposes only and does not constitute investment advice. Follow me for daily insights into the core market themes.
(1) Design Software EDA
Tao's Law requires optimizing transistor and interconnect layouts at the circuit level to reduce the time constant τ, and EDA tools span the entire chip design, simulation, and verification process. Behind Huawei’s mass-produced 381 chips must lie a mature, fully domestic EDA tool ecosystem. The following companies hold key positions in the EDA field:
1. Huada Jiutian
The leading EDA tool provider in China's A-share market, with approximately 6% domestic market share, it is currently the largest and most comprehensive EDA company in China. The company offers a full-flow EDA tool system for analog circuit design, digital circuit design EDA tools, and more, providing foundational support for circuit-level optimizations required by Talao.
2. Primarius Electronics
EDA tools hold the second-largest market share among A-share companies, with core strengths in device modeling and verification EDA tools. The company has developed a comprehensive toolchain covering device modeling, circuit simulation, and yield analysis. The Talos design requires precise optimization of transistor interconnect resistance and capacitance, and Gaolun’s modeling capabilities at the device physics level can be directly integrated into Huawei’s chip design flow.
3. WideSat Micro
EDA tool market share ranks third among A-share companies, focusing on manufacturing-oriented EDA tools, particularly in chip yield enhancement and test chip design. The company’s yield enhancement solutions serve as a critical bridge between wafer foundries and design firms. As logic folding technology moves toward mass production, yield ramp-up processes will increasingly rely on yield management EDA tools like those provided by Widetech.
4. Shanghai Metro
Indirectly holds approximately 7.58% of Huada Jiutian through its subsidiary, Jianyuan Fund. Although Shentong Metro is not a pure EDA company, as a significant shareholder of Huada Jiutian, it stands to benefit from the valuation uplift of domestic EDA companies driven by the Tao Law.
5. Anlu Technology
We have independently developed a full-process FPGA-specific EDA software—TangDynasty. FPGA EDA tools are extremely challenging to develop; Anlu is among the few companies in China capable of providing end-to-end tools spanning logic synthesis to place-and-route. Tao Law emphasizes architectural innovation, and FPGA is indispensable in verification and prototyping. Anlu’s EDA tools will indirectly benefit from Huawei’s ecosystem demand for domestic FPGA and its supporting tools.
6. Siae Microelectronics
Invested in Qingdao Zhancheng Technology (holding 4.67%), a company specializing in IC design EDA tools with a focus on physical verification and layout-related areas. Silex Microelectronics, as a MEMS foundry, has strategically invested in EDA to create synergistic collaboration between manufacturing and design tools.
7. Fudan Microelectronics
FPGA-compatible EDA tools with full-process independent intellectual property rights, capable of supporting the company’s proprietary FPGA products. The company holds a prominent position in China’s high-reliability FPGA market, and its EDA tools have undergone extensive internal validation. The logic folding design promoted by Taolü may be among the first to be implemented in FPGA chips, benefiting Fudan Microelectronics’ integrated hardware-software capabilities.
8. Zhangjiang High-Tech Park
As the developer of Zhangjiang Science City, we have invested in the Shanghai EDA Innovation Center, aiming to build a fully domestic EDA ecosystem. The company operates primarily on an industrial platform and ecosystem investment model, not directly engaging in EDA development, but benefiting from regional industrial agglomeration advantages.
9. Taiji Shares
Develop and procure EDA software in-house for the design of high-power semiconductor products. Although the company specializes in power semiconductors, a market distinct from that of advanced logic chips, the "architecture over process" philosophy promoted by Tao Law may also extend to the power device sector, making Tsinghua's in-house EDA capabilities a key differentiator.
10. Galaxy Micro
Built its own IC EDA design platform, primarily for the independent design of aerospace-grade chips. The company has deep expertise in high-reliability, radiation-hardened chips, and its self-developed EDA platform reflects its demand for autonomy and control over design tools, aligning seamlessly with the spirit of independent innovation behind Taolü.
11. East Soil Technology
Eastwood Technology holds a stake in Zhongke Yihaiwei, whose team independently developed the EDA tools supporting its FPGA products. Through this equity investment, Eastwood Technology indirectly possesses FPGA EDA capabilities, giving it notable thematic flexibility in the wave of domestic substitution.
12. Guangdong Power Electricity A
The subsidiary in which it holds a stake, Shenzhen Capital Group, previously participated in investing in Huada Jiutian. Guangdong Electric Power A holds an indirect stake in Huada Jiutian through multiple layers of nesting, making it a highly indirect beneficiary with a long equity chain and relatively limited upside potential.
(2) Chiplets and Advanced Packaging
Logic folding upgrades circuit layouts from a single-layer planar structure to a multi-layer stacked structure, essentially achieving vertical short-distance interconnects through 3D packaging. This creates a rigid demand for advanced packaging technologies: processes such as multi-layer chip stacking, through-silicon vias (TSVs), and hybrid bonding have become essential. The following companies are key players in China’s advanced packaging and Chiplet technologies:
Tongfu Microelectronics
Domestically, the company leads in advanced packaging technology progress and has already achieved large-scale mass production of AMD’s Chiplet-architecture CPUs and GPUs. The company possesses a complete 2.5D/3D packaging platform, including processes such as TSV, Fan-out, and Hybrid Bonding. AMD is the most successful commercial benchmark for Chiplet technology, and Tongfu Microelectronics, as its core packaging and testing partner, has fully validated the end-to-end process from technology development to large-scale mass production, making it the most likely candidate to handle Huawei’s logic-folded chip packaging requirements.
2. JCET
Domestically, it ranks second in advanced packaging technology progress and has already mass-produced various advanced packaging products (such as SiP, Fan-out, and WLCSP). JCET is the world’s third-largest OSAT provider, with significant scale advantages. Although its current order volume in the Chiplet sector is lower than that of TFME, it possesses strong capabilities to quickly catch up, supported by its large production capacity and extensive customer base.
3. Hua Tian Technology
Ranked third in domestic advanced packaging technology progress, the company has already achieved mass production of advanced packaging products. It focuses on high-density packaging and has established a presence in areas such as FC, TSV, and SiP. Hua Tian Technology’s strengths lie in cost control and rapid customer response, positioning it to capture a portion of packaging and testing orders once logic folding technology matures.
4. Yongxi Semiconductor
Revenue from advanced packaging accounts for nearly 100%, making it a purely advanced packaging company. The company focuses on high-end packaging and testing, with products including QFN, BGA, and SiP. Due to its smaller scale and high business purity, the company often exhibits greater earnings elasticity within the advanced packaging theme.
5. Cambricon
Its cloud AI chip, the MLU370, has adopted Chiplet technology, serving as a prominent real-world example of Chiplet architecture in commercial Chinese chips. Cambricon, as an AI chip design company, does not directly engage in packaging, but the successful validation of its Chiplet implementation demonstrates the feasibility of this technology path. Tao Law will further accelerate the adoption of Chiplet in AI chips, positioning Cambricon, as a pioneer, to gain an early-mover advantage in design methodologies.
6. Verisilicon Holdings
Provide a high-end application processor platform based on the Chiplet architecture. VeriSilicon is a chip design services company (offering IP and design platforms) with an extensive library of Chiplet IP and strong system integration capabilities. The multi-layer stacking design driven by韬定律 will increase demand for Chiplet design methodologies, interface IP, and Network-on-Chip (NoC). VeriSilicon’s platform capabilities are expected to translate into growth in licensing revenue.
7. Lanjian Electronics
The product portfolio covers packaging formats such as DNF, PDFN, and QFN, with QFN being a fundamental type in advanced packaging and testing. The company’s technical capabilities are among the mainstream in China, benefiting from the overall recovery in the semiconductor packaging and testing industry and the domestic substitution trend.
8. Zhi Zheng Shares
Primarily specializes in advanced packaging equipment for semiconductor back-end processes, such as die bonders and testers. During the expansion cycle of advanced packaging, equipment manufacturers are among the first beneficiaries.
9. Dagang Corporation
The company’s subsidiary, Suzhou Keryang Optoelectronics, has accumulated expertise in advanced packaging technologies, primarily focusing on wafer-level packaging and TSV. It is currently still in the phase of technological development and market expansion.
10. Suzhou Gudian
The company is building its presence in advanced packaging through equity stakes and subsidiaries, and is currently in a phase of technological accumulation. Its core business is semiconductor discrete devices.
11. Sanjia Technology
The company is involved in semiconductor packaging molds and equipment, and is currently in the phase of technological accumulation in advanced packaging.
(3) Contract Manufacturing
The compression time constant τ depends not only on circuit design but also requires optimization of transistor structure, interconnect materials, and process parameters at the device level. These optimizations must ultimately be implemented in the foundry’s process platform and design rules. Additionally, Huawei’s upcoming logic-folded Kirin chip, scheduled for release in autumn 2026, must be fabricated and mass-produced by a foundry. All major domestic foundries have the opportunity to secure this historic order:
1. SMIC
The leading wafer foundry in mainland China, ranked fourth globally and first nationally. The company possesses mature 14nm and enhanced processes, along with FinFET advanced manufacturing capabilities. Tao's advocated logic folding technology is essentially design-process co-optimization; as China’s most technologically advanced foundry, SMIC is most likely to become the primary supplier for Huawei’s next-generation Kirin chips. The company also benefits from the broader trend of capacity shifts within China’s domestic semiconductor supply chain.
2. Hua Hong Company
The sixth-largest global and second-largest domestic wafer foundry, Hua Hong specializes in power devices, analog chips, and embedded non-volatile memory. Although Hua Hong’s advanced process capabilities lag behind SMIC, it has deep expertise in specialty processes.韬定律's “logic folding” does not necessarily require the ultra-fine linewidths of 5nm or 3nm nodes; Hua Hong’s mature processes combined with innovative 3D stacking designs could also meet part of Huawei’s edge computing or IoT chip foundry demands.
3. HJ Integrated
The ninth-largest global and third-largest domestic wafer foundry, specializing in DDIC (display driver ICs), MCUs, and other products. The company’s technology nodes primarily focus on mature processes ranging from 40nm to 90nm. Although it lags behind leading-edge logic chip foundries, as the domestic industrial chain localization initiative advances, Jointec is poised to attract an increasing number of mature-node orders from domestic IC design companies.
4. Yandong Micro
Focused on discrete devices and analog ICs, as well as specialized IC foundry services, the company generates annual revenue of approximately RMB 2.056 billion. Its products primarily serve high-reliability and industrial control applications. The radiation effects affecting Tala Law may be transmitted to the design methodologies of analog mixed-signal chips; as a specialized IC foundry, Yandong Micro benefits from the overall trend of domestic substitution.
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