China’s internet giants order $5 billion of Nvidia chips to power AI ambitions – FT
FILE PHOTO: The logo of NVIDIA as seen at its corporate headquarters in Santa Clara, California, in May of 2022. Courtesy NVIDIA/Handout via REUTERS
China’s internet giants are rushing to acquire high-performance Nvidia chips vital for building generative artificial intelligence (AI) systems, making orders worth $5 billion, the Financial Times reported Wednesday.
Baidu, TikTok-owner ByteDance, Tencent, and Alibaba have made orders worth $1 billion to acquire about 100,000 A800 processors from the US chipmaker to be delivered this year, the FT reported, citing multiple people familiar with the matter.
The Chinese groups had also purchased a further $4 billion worth of graphics processing units to be delivered in 2024, according to the report.
READ: Inside China’s underground market for high-end Nvidia AI chips
The Biden administration last October issued a sweeping set of rules designed to freeze China’s semiconductor industry in place while the US pours billions of dollars in subsidies into its chip industry.
Nvidia offers the A800 processor in China to meet export control rules after US officials asked the company to stop exporting its two top computing chips to the country for AI-related work.
The FT report comes as President Joe Biden on Wednesday signed an executive order that would narrowly prohibit certain US investments in sensitive technology in China and require government notification of funding in other tech sectors.
READ: Biden issues executive order restricting US investments in Chinese technology
Nvidia’s finance chief said in June that restrictions on exports of AI chips to China “would result in a permanent loss of opportunities for the US industry,” though the company expected no immediate material impact.
Nvidia declined to comment. Baidu, ByteDance, Tencent, and Alibaba did not immediately respond to Reuters’ requests for comment.
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