Chinese cloud computing services provider UCloud Technology Co has raised concerns about securing orders for Nvidia's advanced chips due to high demand and tightened US export restrictions. These restrictions have been impeding China's efforts in artificial intelligence (AI) development.
UCloud, based in Shanghai, offers infrastructure-as-a-service and AI service platforms to internet companies and traditional enterprises. The company informed investors that its orders for Nvidia's A800 graphics processing units (GPUs), which are allowed for export to China, have been arriving gradually and have had limited impact on the company's operations.
In response to investor inquiries about its A800 order, UCloud stated, "The procurement cycle of the company is affected by various factors, and there are uncertainties regarding the delivery time and quantity of the remaining GPUs we ordered. The company will continue to follow up on the supply. Please be aware of the investment risks."
During a recent roadshow with bankers, UCloud disclosed that it had placed orders for Nvidia's A800 and H800 GPUs, modified versions of the highly sought-after A100 and H100 products for export to China. However, the company did not reveal the quantity of its purchase.
UCloud's uncertainty in securing an adequate supply of Nvidia's GPUs highlights China's significant demand for advanced semiconductors to drive new AI development projects. This demand has led to a growing market for smuggled GPUs.
China's AI ambitions may face further setbacks as the US government reportedly considers restricting Chinese companies' access to American cloud computing services. This potential restriction would impact the ability of Amazon Web Services and Microsoft Corp to use advanced AI chips to benefit their mainland clients.
Despite these challenges, major Chinese companies are still eager to acquire Nvidia GPUs due to the lack of viable alternatives. Tencent Holdings, a Chinese internet giant, introduced new servers for large-scale AI model training based on Nvidia's H800 GPUs in April. Additionally, ByteDance, the owner of TikTok and Douyin, has reportedly ordered $1 billion worth of GPUs from Nvidia this year.
(Source: South China Morning Post)