ByteDance Goes All In: The Chinese Giant Turns to Baidu and Little-Known Iluvatar for AI Chips
The Costly Arms Race: How TikTok Is Fighting for Survival in a World Without NVIDIA
While the Western world is captivated by U.S.–Iran peace talks and falling oil prices, a quieter but no less dramatic battle is unfolding in China. A battle for chips. A battle for artificial intelligence. A battle for survival in a world where America is cutting off access to the most advanced NVIDIA processors through export restrictions.
On Monday, Reuters reported news that caught the attention of investors across Hong Kong’s technology sector. ByteDance—the parent company of TikTok and owner of the world’s most downloaded app—is in talks to purchase AI chips from two Chinese manufacturers. The first is Iluvatar CoreX, a relatively unknown Shanghai-based company that has largely relied on government contracts. The second is Baidu, the internet giant that has spent years trying to turn its Kunlunxin chip project into an independent business.
The report broke during trading hours, sending Iluvatar CoreX shares (ticker 9903 on the Hong Kong Stock Exchange) up nearly 12% at one point. Although much of those gains were later erased, the message was clear: ByteDance is looking for alternatives, and those alternatives increasingly lead to Chinese chipmakers.
Why does this matter? Because ByteDance is not just another Chinese startup. It is a global phenomenon. TikTok—and its Chinese AI-powered platform Doubao—process terabytes of data, generate billions of AI-related requests, and require enormous computing resources. If ByteDance cannot secure chips, its AI ambitions stall. That is why it is willing to buy hardware from almost anyone—even Baidu, a direct competitor in online advertising and search.
Let’s take a closer look at what these negotiations mean, who Iluvatar and Baidu Kunlunxin are, and why this potential deal could reshape the AI landscape.
Iluvatar CoreX: Shanghai’s Dark Horse
For most people, the name...
