Huawei's Ascend 910B Challenges Nvidia's Dominance in The AI Chip Market

Nvidia Corp (NVDA), a well-known name in the field of artificial intelligence (AI) chips, is encountering increased competition from Huawei Technologies Co, with the Chinese tech giant's latest AI chip release, the Ascend 910B. A Huawei executive has made claims that this new chip matches or even exceeds the performance of Nvidia's esteemed A100 in various tests. Specifically, the Ascend 910B shows similar prowess, reaching 80% of the A100's efficiency levels during the training of complex language models, and outperformed Nvidia's chip by 20% in certain other tests.

Amid this evolving competitive landscape, Nvidia finds itself restricted by stringent US export controls that inhibit its ability to ship advanced graphics processing units (GPUs) to China. The South China Morning Post has highlighted these restrictions and their implications for the market.

Introduced in 2019, Huawei's Ascend series has since developed a strong combination of proprietary software and hardware capabilities. Despite international trade limitations, Huawei's AI chip strategy has been successful, particularly within China, where tech giants such as Tencent Holding Ltd (TCEHY), Baidu Inc (BIDU), and iFlytek have incorporated Ascend chips into their operations. Cultivating domestic technological independence is a strategic priority for Huawei, and its AI chips are central to this mission, securing the company's expanding influence in China's market.

While Chinese manufacturers face challenges in producing high-performing AI chips using dated methods, analysts point out that chips like the A100 are substantially more complex than typical smartphone chips. Nevertheless, alternatives such as Huawei's Ascend 910B and Kunpeng processors are proving viable in serving domestic AI needs.

Analytics suggest that while Huawei's top chips may still lag behind Nvidia's latest GPU offerings in technology, Huawei's focused AI strategy and adaptation to the domestic market position it as a substantial competitor to Nvidia within China. In a related development, China's leading chipmaker, Semiconductor Manufacturing International Corp, has been steadily increasing production capabilities using locally-sourced equipment.

Tencent has also been spotted venturing into the creation of AI chips, aiming to carve out a portion of the market heavily dominated by Nvidia, which holds up to 90% of China's approximately $7 billion AI chip market.

Despite challenges, global giants Intel Corp (INTC) and Nvidia continue their commitment to the Chinese market, offering specially designed AI chips for the region. Recently, Nvidia achieved a remarkable market valuation surpassing $3 trillion, overtaking Apple Inc (AAPL) to become the second most valuable company. The company added nearly $150 billion to its market capitalization this past Wednesday. However, the latest stock check on Friday saw NVDA shares trading lower by 1.15%, at $1,196.05.

It should be noted that while AI tools helped produce this content, it was reviewed and published by editorial teams, ensuring accuracy and neutrality.

Nvidia, Huawei, AI