ByteDance AI chip effort may open Qualcomm to new markets outside smartphones

29 May 2026

BEIJING, May 29, 2026, 23:02 (China Standard Time)

ByteDance is moving faster on custom AI chips, working on its own CPUs and reportedly tied to a Qualcomm data-center chip deal, as the TikTok parent looks to ease hardware bottlenecks for its AI plans.

Timing is key here as AI demand shifts from training huge models to “inference,” where models answer prompts, generate output or run tasks. This is ramping up pressure on CPUs, the standard processors that work with Nvidia-style graphics chips in data centers. Reuters

ByteDance is working to put its custom CPUs into its servers and data centers, including for internal use and agent products like Coze, Reuters said, citing three people with knowledge of the situation. The project is still at an early stage. ByteDance has reached out to outside partners for chip design and foundry resources, Reuters reported.

ByteDance is developing two CPU architecture lines, one on Arm and the other on RISC-V, which is an open-source chip design. Having both lets the Beijing-based company test out designs ahead of any bigger manufacturing plans.

ByteDance is working on new AI chips similar to those from Nvidia partner Groq, The Information reported on Friday, citing the headline of its story. Reuters separately said Nvidia launched a central processor and an AI system using Groq technology in March as it looks to hold its ground with AI inference shifting.

Qualcomm is in focus after Bloomberg News said this week that ByteDance struck a deal for millions of Qualcomm’s application-specific integrated circuits, or ASICs, targeting AI data centers. The chips are designed for specific computing tasks. Reuters said it hasn’t independently confirmed the Bloomberg report. Qualcomm and ByteDance did not comment.

Qualcomm shares climbed 2.1% to $248.51 during U.S. morning hours Friday. The stock reached an intraday high of $259.84. Barchart said Qualcomm had already hit new record highs on Tuesday following the ByteDance AI infrastructure deal news.

Qualcomm could pick up a major new customer as it pushes past phones. CEO Cristiano Amon said in April that “the rise of AI agents” was forcing changes to Qualcomm’s roadmap and pointed to a “leading hyperscaler custom silicon engagement” set to ship later this year. Qualcomm

ByteDance is feeling practical pressure too. The company buys CPUs from Intel and AMD, Reuters said. Sources told Reuters those suppliers have bumped prices anywhere from 10% up to 35% in recent months, quarter on quarter. Intel has also warned its customers in China about server CPU lead times reaching six months.

Plenty of risks remain for ByteDance’s chip push. The CPU project is still in its early days, manufacturing slots are limited, and U.S. export rules hang over any chip serving a Chinese AI group. The possible Qualcomm deal will also need to stick to U.S. legal ceilings on AI chip computing power for Chinese customers, Reuters reported, citing Bloomberg.

AI chip battle heats up as firms chase more controlRight now, it’s not just about a single chip. The focus is on who grabs more of the AI stack. ByteDance is after lower costs and more reliable processor supply for its AI agents. Qualcomm is looking to show that the data-center story it tells on earnings calls is real. Intel, AMD, and Nvidia are already on defense, trying to hold their ground.

Leokadia Głogulska Latest posts

Leokadia Głogulska is a financial and technology journalist at TS2.tech. Her coverage ranges from stocks and artificial intelligence to space technology and developments across global markets. She graduated from Wrocław University of Economics and Business and worked in financial analysis before becoming a business journalist.

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