Huawei Prepares Mass Shipment of AI Chips Amid U.S. Export Curbside

Huawei Technologies is preparing to commence mass shipments of its advanced Ascend 910C artificial intelligence chip as early as next month, marking a significant step in China's efforts to reduce reliance on U.S. semiconductor technology. The 910C chip, an upgraded version of the 910B, combines two 910B processors using advanced integration techniques, effectively doubling computing power and memory. This development comes amid U.S. export restrictions that have limited Chinese access to high-performance chips like Nvidia's H20, prompting Chinese AI firms to seek domestic alternatives.

Despite the strategic importance of the 910C, Huawei faces significant production challenges. The chip is manufactured by China's Semiconductor Manufacturing International Corp (SMIC) using its N+2 process. However, due to the lack of advanced lithography equipment—restricted by U.S. export controls—the production yield is currently around 20%, far below the 70% typically required for commercial viability. These low yields have led Huawei to prioritize strategic government and corporate orders, acknowledging the absence of a short-term solution to the manufacturing constraints.

In response to these challenges, Huawei has reportedly supplemented its SMIC-produced chips with those manufactured by Taiwan's TSMC. However, this approach has drawn scrutiny from U.S. authorities, who have ordered TSMC to halt shipments of advanced AI chips to Chinese customers, including Huawei. The U.S. has also intensified export controls on the semiconductor industry, further restricting shipments to Chinese firms. These measures are part of a broader effort by the U.S. to curb China's technological advancements in critical sectors like artificial intelligence.