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Chinese tech giant Huawei is getting ready to test powerful, new AI chips that could rival those made by Nvidia (NVDA+0.54%), according to a new report.
Huawei Technologies will receive its first shipment of Ascend 910E chips from manufacturers as soon as the end of May, the Wall Street Journal reported Monday, citing people familiar with the matter. The processor is Huawei’s most powerful AI semiconductor to date.
According to the report, Huawei is hopeful that the chips will be more powerful than Nvidia’s H100 AI training chip, which it released in 2022. The Shenzhen-based firm boosts the chip’s performance by packing in more silicon.
Shares of Nvidia were down about 3.5% by late Monday morning.
The chip is in the early stages of development and will need to undergo testing with an initial batch of customers to measure its performance, the sources said.
Huawei, one of China’s biggest tech companies, has made persistent technological advances in recent years despite U.S. sanctions against it. The firm has been on a U.S.-trade blacklist for six years, and the U.S. restricts chipmakers from selling certain chip technologies to Chinese firms in an effort to curb the country’s advancements with AI chip technology.
The tightening restrictions under both the Biden and Trump administrations have dealt blows to Nvidia by limiting its potential market. Nvidia designed its H20 chip, in particular, to comply with U.S. export rules — but those rules became even stricter and barred the Santa Clara, California-based company from selling them in China.
Beijing has slammed the U.S.’ approach and President Donald Trump’s attempts to pressure other countries to cut their own trade with China. Earlier this month, China’s foreign ministry said it firmly opposes any trade agreements between the U.S. and third-party countries “at the expense of China,” framing the moves as aggressive rather than defensive.
Nvidia is the world’s most valuable chipmaker with a market capitalization of about $2.6 trillion. But its shares are down 22.5% this year in the face of Trump’s escalating trade war with China.
—Catherine Baab contributed to this article.