Amid restrictions on exports of NVIDIA's graphics processing units (GPUs) necessary for artificial intelligence (AI) development, major corporations in China, including Tencent and Alibaba, have purchased stock from ByteDance, the parent company of TikTok, the Hong Kong South China Morning Post reported on the 29th.
According to the SCMP report, ByteDance has secured NVIDIA GPUs worth approximately 100 billion yuan (about 19.7 trillion won). Tencent purchased about 2 billion yuan (approximately 395 billion won) worth of GPUs centered around NVIDIA's 'H20' chip for AI development, including the AI chatbot 'Yuanbao', in the first quarter. Alibaba also bought GPUs from ByteDance for similar reasons, according to sources.
ByteDance reportedly has the capacity to sell about 10% of its inventory in addition to the stock intended for its own cloud computing division.
The related news came shortly after the United States recently intensified regulations on advanced semiconductor exports to China. Following restrictions on exports of the high-performance GPU H100 used for AI development, NVIDIA has been selling the H20 at a lower specification. However, the H20 has also recently been included in the regulatory targets. IT specialized media The Information reported that the H20 purchased by Chinese corporations like ByteDance, Alibaba, and Tencent in the first quarter of this year totals at least $16 billion (approximately 23 trillion won).
China, which is ramping up efforts to develop AI models, is a major player in the GPU market. Last year, 13% of NVIDIA's revenue came from China. In particular, ByteDance is reported to be the largest purchaser of NVIDIA chips among Asian corporations.
Previously, Jensen Huang, CEO of NVIDIA, visited China on the 17th at the invitation of the China Council for the Promotion of International Trade (CCPIT) immediately after the strengthening of U.S. export controls, emphasizing the commitment to continue services in China. He stated, "We will continue to spare no effort in optimizing our product systems to meet regulatory requirements and will steadfastly serve the Chinese market."