ByteDance in Advanced Talks with Samsung to Secure Production of 350,000 AI Chips
February 11, 2026
In a strategic move to secure its long-term AI computing capacity, TikTok's parent company ByteDance is reportedly in advanced negotiations with Samsung Electronics for the production of specialized AI inference chips. This development underscores the intensifying global race among tech giants to control the hardware underpinning the artificial intelligence revolution, a sector currently constrained by supply chain bottlenecks and geopolitical tensions. According to a Reuters report citing sources familiar with the matter, ByteDance is seeking Samsung's manufacturing capabilities to produce an application-specific integrated circuit (ASIC) designed for AI inferencing workloads. The Chinese technology conglomerate is expecting to receive the first engineering samples of the chip by the end of March 2026. The initial production target for the year is set at 100,000 units, with an ambitious eventual goal of manufacturing a total of 350,000 chips. The negotiations, as reported, extend beyond chip fabrication to include securing a stable supply of high-bandwidth memory (HBM), a critical and scarce component for advanced AI processors. This focus on the memory supply chain highlights the broader industry challenges. Earlier this year, Samsung's memory business head, Kim Jae-june, warned analysts that memory chip shortages were "anticipated to persist due to strong demand linked to AI," likely extending into 2027. He attributed this to limited industry cleanroom capacity for supply expansion. In response, Kim stated Samsung plans a "proactive investment strategy," including advance investment in new fabrication space to secure cleanroom capacity. When contacted by Reuters for comment, a ByteDance spokesperson dismissed the report as "inaccurate," while Samsung declined to comment. This potential partnership follows recent reports that the Chinese government granted ByteDance, along with Alibaba and Tencent, permission to purchase over 400,000 Nvidia H200 GPUs in total, indicating a multi-pronged approach to amassing AI compute power. For the semiconductor industry, a deal of this scale between a leading Chinese internet firm and a South Korean chipmaking champion would represent a significant shift. It signals a growing trend of large tech companies moving beyond reliance on merchant silicon from designers like Nvidia and towards custom, in-house chip designs manufactured by foundries. If finalized, the agreement would provide ByteDance with a more controlled and potentially cost-effective pipeline for the immense computing power required to run and scale its AI-driven services, from TikTok's recommendation algorithms to its burgeoning large language models.
Source: datacenterdynamics
