Customer testing of Huawei's new AI chip, designed to challenge Nvidia in the China market, has gone well. Big tech giants, including ByteDance and Alibaba, plan to place orders for the Huawei AI chip, according to two people familiar with the matter. This development marks a milestone for Huawei. The Shenzhen-based firm previously struggled to persuade private sector big tech firms to adopt its current flagship chip, the Ascend 910C, in large quantities, despite a government campaign to encourage the use of domestic semiconductors.

ByteDance and Alibaba Drive Huawei AI Chip Orders

This time around, tech firms intend to use the new 950PR chip more extensively. They are reportedly happier with its compatibility with Nvidia's CUDA software. Many of Huawei's artificial intelligence chips have faced sales bans in China due to concerns that the technology could enhance the capabilities of the Chinese military. However, the interest from major players like ByteDance and Alibaba suggests a growing confidence in Huawei's capabilities. While the Trump administration previously greenlighted the sale of Nvidia's H200 chips to China under certain conditions, it remains unclear when they will be allowed into the country.

Furthermore, Huawei first mentioned its new chip last September. At that time, the company outlined its long-term semiconductor plans and stated its intention to launch some of the world's most powerful computing systems. The 950PR, utilizing traditional DDR memory, is expected to be priced around 50,000 yuan (approximately US$6,900) per card. A premium version featuring faster HBM memory will be priced around 70,000 yuan.

Consequently, the planned orders from ByteDance and Alibaba for the Huawei AI chip indicate a significant step towards domestic chip independence for China's tech sector.