Chinese Tech Giants Shift to Custom AI Chips for Training Models

In a significant development in the AI landscape, Chinese tech giants Alibaba and Baidu have started utilizing their own custom-designed AI chips to train artificial intelligence models. This move, reported on September 11, 2025, marks a pivotal shift toward domestic hardware solutions within China's burgeoning tech industry.

According to The Information, both companies have been advancing their efforts to reduce reliance on imported technology, aiming to enhance efficiency and performance in AI model training. The use of proprietary chips is expected not only to optimize model generation but also to significantly lower operational costs in the long term.

Historically, many Chinese tech firms have depended on foreign suppliers for their AI hardware, primarily from established chip manufacturers like NVIDIA. However, with the escalating geopolitical tensions and a push for self-sufficiency in tech, Alibaba and Baidu's transition to in-house chip production reflects broader trends in the Chinese market, where a focus on innovation and independence is increasingly emphasized.

Industry analysts suggest that this move could lead to a competitive advantage for these companies, enabling them to fine-tune their hardware to better suit their specific AI applications. This strategic pivot also underscores the growing capabilities of China's semiconductor industry, which is aiming to compete on a global scale.

As the AI sector evolves, further developments from these tech giants will likely reveal how customized hardware impacts model training efficiencies and the broader AI ecosystem in China.