China's AI chipmakers raise prices as high-bandwidth memory shortage bites

• Huawei's Ascend 950DT accelerator card price increased to above 250,000 yuan ($37,255), up 20-50% from two months ago, while older models like the 950PR rose 30% to over 80,000 yuan
• U.S. export controls on advanced HBM forced Chinese chipmakers to source memory through grey-market channels at several times the price paid by buyers outside China
• The shortage is disrupting supply chains, with Iluvatar CoreX doubling GPU shipments to ByteDance and diverting chips from internal use to meet demand in China's $50 billion AI chip market

Summary: China's AI Chipmakers Raise Prices Amid HBM Shortage

Chinese AI chipmakers, including Huawei Technologies and Cambricon, have sharply increased prices for current and next-generation AI processors due to a severe shortage of high-bandwidth memory (HBM), sources report.

Key Price Increases:

• Huawei's Ascend 950DT accelerator card now exceeds 250,000 yuan ($37,255), up 20-50% from two months ago
• Cambricon's planned 690 chip increased 20-30% over previous quotes
• Huawei's Ascend 950PR rose approximately 30% to over 80,000 yuan from 60,000 yuan earlier this year
• The older Ascend 910C climbed to more than 110,000 yuan from 90,000 yuan

Market Context:

The price hikes stem from a global HBM shortage impacting China's $50 billion AI chip market. HBM is critical for AI computing, with the advanced market dominated by SK Hynix, Samsung Electronics, and Micron Technology. Since December 2024, U.S. export controls on advanced HBM products to China have forced Chinese chipmakers to rely on grey-market channels, where costs run several times higher than legitimate prices.

Companies Affected:

Huawei, Cambricon, MetaX, and Iluvatar CoreX have all implemented similar price increases. ByteDance, a major customer and TikTok developer, has seen its GPU shipments from Iluvatar CoreX doubled to meet computing demands.

Implications:

The shortage increases costs for building AI computing capacity in China and creates bottlenecks for domestic chipmakers attempting to replace Nvidia products with homegrown alternatives, as Beijing pushes for technological self-sufficiency amid Western export restrictions.