A360
Key Takeaways✦ Atlas AI
01
Demand for Huawei AI chips surges.
02
DeepSeek V4 optimizes for Huawei chips.
03
U.S. export controls drive domestic shift.
Atlas AI
Major Chinese technology companies including ByteDance, Tencent, and Alibaba are increasing purchases of Huawei’s Ascend 950 artificial intelligence chips after the April 24 release of DeepSeek’s V4 AI model, which is designed to run efficiently on the Ascend 950 series.
People familiar with the matter said the jump in orders reflects a stronger push toward domestic AI hardware as U.S. export controls continue to restrict access to advanced semiconductors. The same sources said interest has also risen among cloud computing providers and GPU rental services that supply AI computing capacity to customers.
DeepSeek V4 optimization lifts demand for Ascend 950
DeepSeek’s V4 model is optimized for Huawei’s Ascend 950 chips, and that alignment has become a key driver of procurement plans, according to the people familiar with the matter. They said the model’s release has accelerated commercial attention on the Ascend 950 series across multiple parts of China’s AI infrastructure market.
Officials and industry sources have pointed to U.S. export controls as an ongoing constraint shaping hardware choices. In that environment, the sources said, domestic chips that can support large-scale AI workloads are drawing more interest from companies that need predictable access to computing supply.
Performance comparisons and export limits shape choices
According to the people familiar with the matter, Huawei’s Ascend 950PR outperforms Nvidia’s H20, but it does not match the performance of Nvidia’s H200. The H200, they added, faces regulatory obstacles for export to China, which has affected its availability in the market.
The sources said the latest procurement wave follows earlier customer testing that was described as successful. Companies began planning larger orders after receiving Ascend 950 samples in January, they said, and the April 24 model release added momentum to those plans.
Compressed numerical format cited as a domestic differentiator
Huawei’s Ascend 950 series, and especially the 950PR variant, is described by the people familiar with the matter as the only domestic chip currently able to handle AI computations in a compressed numerical format. They said this capability improves computational efficiency, which can matter for both training and deployment workloads.
On the software and platform side, Alibaba Cloud’s Bailian platform and Tencent Cloud’s TokenHub platform have already added DeepSeek V4, according to the companies. That integration makes the model available to a wider set of users through established cloud channels.
Supply constraints expected to persist
Despite the increase in demand, DeepSeek expects supply limitations for Ascend 950 chips to continue until production expands, according to the people familiar with the matter. They said the supply outlook remains a key uncertainty for companies trying to secure near-term AI computing capacity.
DeepSeek also expects possible price cuts for V4-Pro in the second half of 2026, the sources said. For now, the market focus remains on how quickly Ascend 950 production can scale to meet the rising order pipeline.
