China's ByteDance is collaborating with U. S. chip designer Broadcom to develop a cutting-edge AI processor, according to two sources familiar with the matter. This partnership aims to ensure a stable supply of high-end chips for ByteDance, the owner of TikTok, amid tensions between the United States and China. The custom 5 nanometre ASIC chip will comply with U. S. export restrictions, and Taiwan's TSMC will handle the manufacturing process. This collaboration is significant as there have been no publicly announced chip development partnerships between Chinese and U. S. companies involving advanced technology since export controls were implemented in 2022.

The collaboration with Broadcom, an existing business partner, will reduce procurement costs for ByteDance and guarantee the availability of higher-end chips. However, the manufacturing of the new chip by TSMC is not expected to commence this year. Despite repeated requests for comment, neither ByteDance nor Broadcom responded, while TSMC declined to comment. ByteDance's focus on generative artificial intelligence has led to a demand for AI chips, which are currently in limited supply for Chinese companies. Export controls prevent them from accessing advanced chipsets like those from Nvidia, and competition for AI-specific chips is intense. ByteDance has also stockpiled Nvidia chips and purchased Huawei's Ascend 910B chips to support its AI initiatives. The company has numerous semiconductor-related job openings and has been attracting talent from other Chinese AI chip firms.