Global demand for artificial intelligence infrastructure continues to surge, and China’s largest internet companies are stepping up spending.
TikTok parent ByteDance is ramping up its artificial intelligence spending and plans to allocate about 100 billion yuan ($14 billion) to Nvidia Corp. (NASDAQ:NVDA) chips in 2026.
The proposed budget, up from roughly 85 billion yuan in 2025, reflects ByteDance’s aggressive push to expand AI infrastructure across its apps, cloud services, and large language models, SCMP reported on Wednesday.
Also Read: Nvidia’s China Chip Boom Faces Threat As Beijing Pushes For Homegrown AI
Reports indicate that the company could increase its total AI investment to as much as 160 billion yuan by 2026.
In-House Chips And Memory Investments Take Shape
With a private valuation of nearly $500 billion, the company’s internal semiconductor unit has moved forward with the tape-out of a new processor designed to rival Nvidia’s H20 chip for the Chinese market, offering a more cost-efficient alternative.
Rising computing demand across TikTok, Douyin, its Volcano Engine cloud platform, and its AI models is driving the surge in spending.
The company is also aggressively investing in memory technologies, including high-bandwidth memory.
Nvidia Demand Surges Amid Policy Uncertainty
Meanwhile, Nvidia is considering an expansion of production for its H200 artificial intelligence chips to tap into the Chinese demand.
President Donald Trump said that the U.S. will allow Nvidia to sell H200 processors to China, provided the company pays a 25% fee on each shipment.
Alibaba Group Holding Ltd. (NYSE:BABA) and ByteDance have already approached Nvidia to place sizable orders, although Beijing has yet to approve any H200 imports formally.
Bank of America Securities analyst Vivek Arya reiterated Nvidia as his top AI pick, saying the company still leads AI computing by at least one whole generation.
However, he cautioned that China-related uncertainty remains as Nvidia navigates new U.S. export rules.
Nvidia became the first company to reach a $4.5 trillion market value in October as global AI demand continued to drive explosive growth for its GPUs.
NVDA Price Action: Nvidia shares were down 0.48% at $186.64 during premarket trading on Wednesday, according to Benzinga Pro data.
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