Huawei Seizes AI Chip Opportunity in China Amid U.S. Curbs on Nvidia

The imposition of U.S. restrictions on advanced artificial chips from Nvidia to China has paved the way for Huawei to gain market share.
Huawei @ MWC Shanghai 2023
Reuters news reports indicate that Huawei secured a significant AI chip order from Chinese tech giant Baidu this year, allowing Huawei to further establish its presence in the competitive AI chip market.

While Huawei is internationally recognized for its telecommunications and smartphone businesses, it has been steadily building an AI chip line for the past four years. The company’s Ascend AI chip series, particularly the 910B, is positioned to rival Nvidia’s A100 chip.

Huawei’s Entry into the AI Chip Business:

Huawei first introduced its Ascend 910 in 2018 and officially launched the chip in 2019. This strategic move aimed to build a comprehensive AI portfolio and become a significant provider of computing power.

In the same year, Huawei became subject to U.S. export controls. Despite these challenges, the company claimed that the Ascend 910 was the world’s most powerful AI processor, manufactured on a 7-nanometer process.

The chip boasted impressive performance, with the ability to deliver 256 TeraFLOPS for half-precision floating-point (FP16) operations and 512 TeraOPS for integer precision calculations (INT8).

Huawei highlighted the chip’s efficiency, noting a maximum power consumption of 310W, which was below the original target of 350W.

However, despite its capabilities, the Ascend 910 faced stiff competition from Nvidia, which introduced the A100 and H100 chips in 2020 and 2022, respectively, solidifying its dominance in the AI chip market. Experts pointed out that Nvidia’s established ecosystem and software played a crucial role in maintaining its market leadership.

The Ascend 910B – Huawei’s Latest AI Chip:

While Huawei has not officially announced the Ascend 910B, details about the chip have surfaced through public comments from Chinese companies and academics, as well as technical guides on Huawei’s website.

Notably, the chairman of Chinese AI giant iFlyTek, Liu Qingfeng, praised Huawei for producing a GPU that he likened to Nvidia’s A100. It was reported that the hardware was powered by the previously undisclosed Ascend 910B.

Documents related to the Ascend 910B began appearing on Huawei’s website in August, including driver and firmware upgrade guides.

Reports indicated that Baidu ordered 1,600 of Huawei’s 910B chips for 200 servers in August.

Although the 910B chips are deemed comparable to Nvidia’s in terms of raw computing power, they may still lag behind in performance. Nevertheless, they are considered the most sophisticated domestic option available in China.

Significance for Huawei and China:

Analysts estimate that China’s AI chip market is valued at $7 billion. Gaining market share from Nvidia could represent a substantial victory for Huawei against the United States.

Huawei has expressed its ambition to become a key provider of computing power for AI. Chief Financial Officer Meng Wanzhou highlighted in September the company’s goal to build a computing base for China and provide the world with a “second option,” alluding to the dominant U.S. presence in the industry.

As China’s AI companies face the absence of Nvidia chips, they may increasingly rely on domestic alternatives like Huawei’s chips. Given the substantial support and investment from the Chinese government in AI and semiconductor development, it is anticipated that Huawei may bridge the performance gap over time, further strengthening its position in the AI chip market.