Exclusive-China’s AI chipmakers raise prices as high-bandwidth memory shortage bites

Sept 10 (Reuters) – Chinese AI chipmakers including Huawei Technologies and Cambricon have sharply raised prices for current and next-generation AI processors, three people familiar with the matter said, as soaring costs for high-bandwidth memory squeeze efforts to build domestic alternatives to Nvidia.

Huawei ‌has lifted the indicated price of its Ascend 950DT accelerator card, which integrates an AI processor with memory and other components, to ‌above 250,000 yuan ($37,255), two people said.

The increase represents a jump of 20% to 50% from prices quoted to customers just two months ago, depending on contract terms, they said. Shenzhen-based Huawei ​has publicly said the 950DT, its most advanced AI chip, will be available in the fourth quarter of 2026.

Beijing-based Cambricon has also repriced its next-generation chip, tentatively called the 690, at 20% to 30% above levels it indicated two months ago, two sources said, without giving an exact figure. Smaller rivals MetaX and Iluvatar CoreX have made similar increases, the sources said.

The people declined to be identified because the pricing discussions are not public.

The price hikes illustrate how a ‌worldwide shortage of high-bandwidth memory (HBM) is reverberating through China’s ⁠AI industry as Beijing presses companies to replace Nvidia products with home-grown alternatives.

HBM is a crucial component for AI computing, consisting of vertically stacked memory chips that allow processors to access vast amounts of data at high speeds. The ⁠advanced HBM market is dominated by South Korea’s SK Hynix and Samsung Electronics, and U.S.-based Micron Technology.

Since Washington tightened controls on exports of certain advanced HBM products to China in December 2024, Chinese chipmakers have increasingly relied on grey-market channels to secure supplies, the sources said.

Such HBM typically costs several times what buyers outside China ​pay, ​they said. Because memory accounts for a large share of an AI accelerator’s production ​cost, the higher prices are feeding directly into finished cards.

Huawei ‌has said the Ascend 950 series will use two proprietary HBM technologies: HiBL 1.0 for the 950PR and HiZQ 2.0 for the 950DT, without detailing where or how the memory is manufactured.

The 950DT is built mainly for developing AI models and generating responses, while the 950PR processes user requests before they are passed to the model.

Huawei, Cambricon, MetaX and Iluvatar CoreX did not respond to requests for comment.

OLDER HUAWEI CHIPS ALSO MORE EXPENSIVE

Prices of Huawei’s earlier-generation products have also climbed. The Ascend 950PR, which sold for roughly 60,000 yuan per card at the start of the year, now fetches more than ‌80,000 yuan, up about 30%, two of the sources said.

The older Ascend 910C board ​has risen to more than 110,000 yuan from about 90,000 yuan at the start of ​the year, they said.

The price hikes increase the cost of building ​AI computing capacity and highlight a growing bottleneck for Chinese chipmakers, who benefited from a void in China’s $50 billion ‌AI chip market after U.S. export controls restricted the country’s ​access to Nvidia’s most advanced processors.

The shortage ​is forcing suppliers to reshuffle allocations.

Iluvatar CoreX has doubled its shipments of graphics processing units (GPUs), a type of chip used for training and running AI systems, to tech giant and TikTok developer ByteDance to 100,000 units this year, according to one source, as computing constraints ​intensified.

The company has also diverted GPUs earmarked for internal ‌use to help meet ByteDance’s needs, the source said.

Cambricon has not formally launched the 690. Its current flagship is the 590. ​Huawei is ByteDance’s largest domestic supplier, followed by Cambricon and Iluvatar CoreX, the three sources said.

ByteDance did not respond to a ​request for comment.

(Reporting by Reuters staff; Editing by Eduardo Baptista and Shri Navaratnam)