Alibaba Group Holding Limited (NYSE:BABA) is stepping up its push into artificial intelligence infrastructure with the launch of a high-end, self-developed AI chip, part of a broader effort to reduce reliance on Nvidia Corp.'s (NASDAQ:NVDA) as U.S. export controls restrict China's access to advanced semiconductors.



On Thursday, Alibaba's semiconductor design unit, T-Head, released technical specifications for its advanced parallel-processing unit, the Zhenwu 810E. According to T-Head's website, the Zhenwu 810E is a fully in-house-designed application-specific integrated circuit built to handle both AI training and inference workloads.



The chip is aimed at the high data-throughput requirements of generative AI and delivers performance broadly comparable to Nvidia H20, a GPU tailored for the Chinese market, SCMP reported. Before U.S.-China regulatory tensions escalated, Nvidia said it controlled about 95% of China's advanced AI chip market.



<h2>Alibaba Cloud Scales Deployment</h2>



T-Head said the Zhenwu 810E is already operating in multiple 10,000-card clusters within Alibaba Cloud and is being used by large external customers. 



Technode reported the chip now supports more than 400 clients, including State Grid, the Chinese Academy of Sciences, and XPeng (NYSE:XPEV), and has been optimized for training and inference of Alibaba's Qwen large language models. 



Separately, Reuters reported that more than 400,000 Nvidia H200 units are expected to be shipped to Chinese customers, including ByteDance, Alibaba, and Tencent Holding Ltd. (OTC:TCEHY).



<h2>IPO Plans for Chip Units Take Shape</h2>



The push comes as Alibaba and Baidu Inc. (NASDAQ:BIDU) move toward spinning off their chip divisions. Bloomberg reported Alibaba plans to restructure T-Head into a partially employee-owned business before considering a public listing. 



Founded in 2018, T-Head designs computing and storage chips. Baidu is preparing a Hong Kong IPO for its Kunlunxin unit that could raise up to $2 billion, while retaining about 59% ownership.



BABA Price Action: Alibaba shares were down 1.24% at $172.09 during premarket trading on Friday, according to Benzinga Pro data.



Photo by VTT Studio via Shutterstock

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Alibaba has launched its self-developed AI chip, Zhenwu 810E, to compete with Nvidia in China's AI market. The chip, designed by Alibaba's T-Head unit, is optimized for AI training and inference and is already deployed in Alibaba Cloud, serving over 400 clients. This move is part of Alibaba's strategy to reduce reliance on Nvidia amid U.S. export controls. Additionally, Alibaba plans to restructure T-Head into a partially employee-owned business and consider a public listing. Alibaba shares fell 1.24% to $172.09 in premarket trading.

- Alibaba Group is enhancing its artificial intelligence infrastructure with the launch of its self-developed AI chip, the Zhenwu 810E, to reduce dependence on Nvidia due to U.S. export controls.  
- The Zhenwu 810E is designed for AI training and inference, currently operational in Alibaba Cloud, and serves over 400 clients, including major Chinese entities.  
- Alibaba is also restructuring its semiconductor design unit, T-Head, for a potential public listing, as it and Baidu move towards spinoff plans for their chip divisions.

Alibaba Unveils AI Chip Built To Challenge Nvidia's Grip On China