First reported by Reuters, ByteDance, the parent company of TikTok, is developing the CPUs to support its growing AI infrastructure needs – a move that comes as chip prices continue to rise and supply shortages persist.
The company is perhaps eager not to fall behind in its own development, with its decision reflecting how the wider industry is shifting towards the inference phase in AI development. It is reportedly targeting deployments of its proprietary CPU in its own servers and data centres to support internal operations as it prepares a rollout of agent-based products, including its Coze platform, the sources said.
They added that ByteDance has also apparently approached several external partners to assist with these plans, who are expected to contribute to the chip’s design work and help secure manufacturing capacity at foundries.
ByteDance is expected to be pursuing two chip architecture tracks for its CPU development, the sources said, which will enable them to test their options before committing to manufacturing.
At the end of last year, ByteDance announced plans to significantly expand its AI infrastructure, expecting to spend around US$23 billion on capital investment in 2026. Half of the planned outlay was expected to be saved for semiconductors, as competition for AI chips boomed last year.
The shift towards companies developing their own CPUs has intensified in recent months, with companies like Google, Amazon and Microsoft among those developing custom chips to reduce costs and tailor the hardware to their specific workloads.
AMD is also working closely with its partners to increase its production capacity and has announced plans to invest more than $10 billion across Taiwan’s AI sector. CEO Lisa Su warned that the global CPU market is “tight” currently, as demand continues to outpace forecasts.
ByteDance currently sources CPUs from AMD and Intel, but price increases have apparently prompted the company to consider developing the hardware in-house, Reuters sources said.
Nvidia continues to be the dominant company in the market and is now expanding beyond GPUs to CPUs, with CEO Jensen Huang confirming its plans will create a new platform shift.
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