DeepSeek bets big on Huawei chips for new AI model

DeepSeek, the Chinese company behind several well-known AI models, is undergoing a major shift. Founder Liang Wenfeng has told investors that the company will in future rely more on Chinese Huawei chips instead of the American Nvidia chips that are otherwise the industry standard.

The background is the American export rules that restrict China's access to the most advanced American AI chips. By using chips from Huawei, DeepSeek can instead draw on Chinese technology and thereby make itself less dependent on American hardware.

DeepSeek is currently working on a model with 2,000 billion parameters and is later planning an even larger model with 8,000 billion parameters. Parameters are the settings in an AI model that determine how it responds to input, and a higher number roughly means a more advanced and powerful model. According to the preliminary plans, the large training run on Huawei's new Ascend 950 chips is set to begin at the end of 2026.

Liang Wenfeng calls the switch one of the company's "biggest strategic bets, which simply has to succeed." DeepSeek is setting aside about $4.5 billion to expand its computing power and is also in the middle of a funding round that could value the company at $74 billion.

For now, DeepSeek is running a dual track, using both its existing Nvidia capacity and gradually adopting Huawei chips. For ordinary users of DeepSeek's AI services, the news has no immediate impact on daily use, but it is yet another sign that China is trying to build its own AI infrastructure that bypasses American technology, something that over time could produce more and cheaper AI models outside the American track.

What this means for you

If you use DeepSeek today, you won't notice anything right now; the service continues as normal. The news is more interesting if you follow AI development in general: it shows that China is seriously trying to build an AI world that bypasses American technology. If it succeeds, it could over time mean more and cheaper AI models to choose from, including outside the US.