Key facts
- Qualcomm is in discussions to provide custom chip-design services to ByteDance.
- The chips would be based in part on technology owned by AlphaWave Semi.
- Discussions involve designing video processing units with mass production eyed by year-end.
- ByteDance is also developing AI chips for inference tasks and custom CPUs.
Qualcomm is reportedly in discussions to provide custom chip-design services to ByteDance, the parent company of the short-video platform TikTok. Four people familiar with the matter told Reuters that the U.S. company is seeking to diversify beyond the smartphone market, its primary revenue source.
Three sources indicated that the talks involve designing custom chips, partly utilizing technology from AlphaWave Semi, a connectivity specialist acquired by Qualcomm last year. One source suggested the discussions focus on video processing units (VPUs) with the aim of starting mass production by the end of the year. However, the outcome remains uncertain, with ByteDance potentially exploring other partners.
This development highlights continued interest from U.S. tech firms in the Chinese market, despite escalating tensions between Washington and Beijing concerning AI chips, which have affected companies like Nvidia, AMD, Applied Materials, and Lam Research. Reuters previously reported that ByteDance is developing its own AI chips for inference tasks and custom central processing units (CPUs).
A deal with ByteDance would represent a significant achievement for Qualcomm, which has faced market uncertainty due to rising memory chip prices and an anticipated record contraction in global smartphone shipments this year. Qualcomm is actively pursuing opportunities in the data center chip market, developing CPUs, inference accelerators, and custom ASICs, competing with firms like Broadcom and Marvell.