US Restricts Sales of Advanced Chip-Making Machinery to China, Huawei Sees Opportunity to Fill Void

Amid US's regulatory power flexing affecting key nations like Netherlands and Japan, Huawei analyzes the potential to expand its homegrown AI chip market share in China, creating alternatives to Nvidia's dominance.

The US has implemented regulations restricting the sale of advanced chip-making machinery to China, impacting the global supply chain and giving US regulatory power over other nations where machinery is made, such as the Netherlands and Japan.
The Dutch company ASML, a dominant player in the lithography market, is particularly affected as US regulations will halt the shipment of their DUV (deep ultraviolet) technology machines to China, dealing a significant blow to China's chip manufacturing ambitions.
Under these circumstances, Huawei sees a potential opportunity to expand its homegrown AI chip market in China, creating alternatives to Nvidia's dominance.
Huawei's Ascend AI chips are comparable in raw computing power to Nvidia's but lag in performance and software adaptability. To truly succeed, Huawei will have to replicate the programming architecture and ecosystem created by Nvidia, which may take years.
Despite the challenges and ongoing US sanctions, Huawei has demonstrated resilience by unveiling an advanced smartphone chip and making claims of breakthroughs in chip design tools. The telecom giant aims to become a key provider of computing power for AI in China, potentially giving the world a second option to US dominance.