ByteDance to spend $14B on NVIDIA AI chips in 2026
What's the story
ByteDance, the parent company of TikTok, is planning to invest around 100 billion yuan ($14 billion) in artificial intelligence (AI) chips from NVIDIA in 2026. This marks a significant increase from the estimated investment of around 85 billion yuan in 2025. The decision is contingent on whether NVIDIA will be allowed to sell its H200 graphic processing units (GPUs) in China.
Investment strategy
ByteDance's ambitious AI capital spending plan
The proposed investment is part of ByteDance's ambitious capital spending plan for AI in 2026. The company, which has a private market capitalization of $500 billion, has also developed a chip design unit with around 1,000 employees. This unit is working on a processor that could match the performance of China-centric NVIDIA's H20 chip but at a lower cost.
Tech advancements
ByteDance's chip unit and memory technology investments
ByteDance's internal chip unit has made strides in developing a processor that could rival NVIDIA's H20 chip. The company is also investing in memory technologies such as high-bandwidth memory. This investment strategy includes a mix of in-house development and investments in related start-ups.