en.Wedoany.com Reported - ByteDance is in talks with Shanghai-based Iluvatar CoreX to procure AI inference chips, and is also considering purchasing Kunlunxin products from Baidu. If the deal materializes, Iluvatar CoreX will become ByteDance's third domestic GPU supplier after Huawei and Cambricon.
Two sources familiar with the matter said that ByteDance, the parent company of TikTok, is also considering using Baidu's Kunlunxin chips, while Tencent is already a Kunlunxin customer. These developments indicate that amid U.S. export controls on advanced chips, China's efforts to promote domestic chip alternatives to foreign products are gaining market traction. Reuters reported in April that Chinese GPU and AI chip manufacturers captured approximately 41% of the domestic AI accelerator server market in 2024, weakening Nvidia's dominance in this key overseas market. Nvidia CEO Jensen Huang stated that the company's market share in China has effectively dropped to zero, but Tencent's Chief Strategy Officer James Mitchell said in May that Chinese AI chips will be widely available in the second half of this year.
Sources revealed that leading domestic GPU startup Iluvatar CoreX is expected to ship at least 50,000 chips to ByteDance this year, the vast majority for inference workloads. This is because ByteDance is expanding its customer base for its AI chatbot "Doubao." Inference involves answering queries, which differs from AI model training that focuses on the most powerful chips. The details of the above transaction have not yet been finalized and remain subject to change.
Partnering with ByteDance would be a major commercial milestone for Iluvatar CoreX. Sources said the Shanghai-based company previously mainly supplied government procurement projects. Iluvatar CoreX went public on the Hong Kong Stock Exchange in January this year, with 2025 revenue reaching 1 billion yuan (approximately $148 million), of which about 90% came from GPU sales. According to its official website, the Tiangai series chips are designed for AI training, while the Zhikai series targets inference tasks. A research report from Huatai Securities shows that Iluvatar CoreX's revenue is expected to reach 3.04 billion yuan (approximately $449.8 million) this year, with total shipments projected to surge 139% to over 100,000 chips. The brokerage estimates the average selling price of Zhikai inference chips at 12,000 yuan (approximately $1,775) each.
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