- Tencent president Martin Lau said on Wednesday the company is holding a vast stockpile of chips.
- Its inventory is enough to last its AI development a "couple more generations," Lau said.
- The US issued a new AI chip export ban to China in October, sparking fears that Tencent could be hit.
A top Tencent exec said on Wednesday that the Chinese tech giant is holding a huge stockpile of Nvidia processors, downplaying fears that new US export bans might cripple its business.
"Now in terms of the chip situation, right now we actually have one of the largest inventory of AI chips in China among all the players," Tencent president Martin Lau said in a Q3 earnings call.
Lau said Tencent was one of the first in China to put in large orders for the H800 chip, the GPU specifically created by Nvidia for the China market. In October, the Biden administration banned the export of the H800 to China as part of a broader move to curb China's — especially the Chinese military's — access to US technology and advanced semiconductors.
Lau addressed concerns that business would be affected, saying Tencent's stockpile of H800 chips is large enough to sustain development of its AI model, Hunyuan, for the foreseeable future.
"We have enough chips to continue our development of Hunyuan for at least a couple more generations," Lau said. "So the ban does not really affect the development of Hunyuan and our AI capability in the near future."
But Lau also said Tencent will eventually have to pivot toward China-made AI chips.
"Going forward, we have to figure out ways to make usage of our AI chips more efficient," Lau said.
Advanced chips like the H800 are key to tech firms staying competitive in AI , because they're essential to the speedier training of models. Chinese tech firms like Tencent and Alibaba have largely relied on US-made chips.
Nvidia's H100, for example, was the chip used to train OpenAI's chatbot ChatGPT.
The US originally banned the export of the H100 and equivalent models to China, but Nvidia later released new versions of those chips, including the H800, designed as workaround processors to ship to China.
So the US banned exports of those new chips, too.
Before the ban, however, China's biggest tech players such as Baidu, Alibaba, and Tencent collectively spent $5 billion to stockpile a total 100,000 advanced chips from Nvidia, The Financial Times reported in August.
Chinese companies are rapidly debuting new AI models to rival their US counterparts, but have so far been playing catch-up.
Tencent's model, Hunyuan, is expected to focus mostly on gaming and enterprise software, which are key pillars of the tech firm's business.