TikTok parent company ByteDance told suppliers it planned to spend $7 billion to access Nvidia chips outside of China throughout 2025.

According to a report from The Information, such a move would make ByteDance one of Nvidia’s biggest global customers.

ByteDance
– ByteDance

This is not the first time The Information has highlighted the ways in which Chinese companies have exploited loopholes in US sanctions to access AI chips unavailable in China. In June 2024, the news outlet reported that ByteDance had been renting Nvidia’s best chips from Oracle for AI computing.

China is currently unable to legally purchase advanced semiconductor technology from abroad due to wide-ranging sanctions that have been put in place by the US government.

Citing two people involved with the plan, the latest report from The Information claims ByteDance co-founder Zhang Yiming has held discussions with data center operators in regions including Southeast Asia about gaining access to Nvidia's Blackwell chips when they become available in 2025.

Renting advanced GPUs in the US is not a violation of current sanction laws however, the outgoing Biden administration had reportedly discussed capping the sales of advanced AI chips to certain countries including the United Arab Emirates (UAE) and Saudi Arabia to further reduce the ability of Chinese companies to access AI chips.

The Biden administration has already banned exports of Nvidia and AMD's latest GPUs to some countries in the Middle East amidst accusations that the UAE had become a potential “transshipment point” used by Russia to evade sanctions and the country’s deepening ties with China. Countries in Africa and Asia were also impacted by those restrictions, which came into force in August 2023.

In recent years, ByteDance expanded its data center footprint, in part to meet growing demand but also to quell concerns from governments about data being sent to China, where the company is based.

Again citing the same two people with knowledge of the company’s plans, The Information said ByteDance had told some data center suppliers that it was planning to spend more than $20 billion next year on AI chips, data centers, and other kinds of infrastructure such as undersea cables. However, this figure could be subject to change once the company finalizes its 2025 budget.

DCD has reached out to ByteDance for comment.