NVIDIA is facing competition from Huawei Technologies’ latest AI chip, the Ascend 910B. Huawei executives claim it matches or surpasses NVIDIA’s A100 in some tests.
The Ascend 910B offers 80% of the A100’s efficiency when training large language models and can perform 20% better in other tests. Huawei’s Chief Operating Officer of the Kunpeng department, Wang Tao, mentioned that Huawei has successfully narrowed the gap with NVIDIA’s A100
According to the South China Morning Post (SCMP), these claims come amid strict U.S. export restrictions preventing NVIDIA from shipping advanced GPUs to China.
Huawei introduced the Ascend series in 2019 and has built a robust proprietary software and hardware ecosystem.
Despite these restrictions, Huawei’s AI strategy has gained traction with major Chinese tech firms like Tencent (OTC:TCEHY), Baidu (NASDAQ:BIDU), and iFlyTek adopting Ascend chips. Huawei’s AI chips are crucial to its goal of achieving technological self-sufficiency in China as it continues to expand its influence in the domestic market.
Analysts have pointed out the challenges faced by Chinese manufacturers in producing high-performance AI computing chips using older systems.
AI chips like NVIDIA’s A100 are much broader and more complex than typical smartphone chips.
However, Huawei’s Ascend 910B and Kunpeng chips have emerged as viable alternatives for domestic AI applications.
Recent reports state that NVIDIA’s H20 AI GPU, designed specifically for the Chinese market, failed to spark consumer interest, leading NVIDIA to reduce the pricing of its accelerators to maintain market “relevance.” This indicates that Chinese tech giants are now considering a shift to domestic AI products, presenting a rare opportunity for companies like Huawei.
According to analysts, while Huawei’s best chips are still technologically inferior to NVIDIA’s latest GPUs, the company’s AI strategy and adaptations to the domestic market pose considerable competition for NVIDIA in China.
Reports indicate that China’s leading chip manufacturing company, Semiconductor Manufacturing International Corp (SMIC), has been increasing chip production with domestic tools.
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Previous reports suggested that Tencent’s AI chip development was aimed at capturing a portion of NVIDIA’s market share, which dominated up to 90% of China’s $7 billion artificial intelligence chip market.
Meanwhile, Intel and NVIDIA remain committed to the Chinese market with their custom-made AI chips.
NVIDIA recently reached a market valuation of over $3 trillion, surpassing Apple as the second most valuable company. This Wednesday, NVIDIA added nearly $150 billion to its market capitalization.
