Huawei and Advanced Chip Production Despite Sanctions | Cpu hardware examples | 5 basic components of cpu | Gpu vs cpu vs graphics card | Turtles AI

Huawei, through its collaboration with SMIC, is advancing AI chip production despite US restrictions. SMIC, using Western tools, has overcome production hurdles, aiming for 50,000 7nm wafers per month by 2025.

Key Points:

• Huawei, SMIC advance AI chip production despite restrictions.
• US tools have enabled SMIC to improve its 7nm process.
• NVIDIA’s A800 and H800 GPUs have circumvented US restrictions.
• SMIC plans significant expansion, targeting 400,000 910C chips per month.

Despite the weight of US sanctions, Huawei appears to have found a way to circumvent the restrictions and maintain a competitive edge in the semiconductor industry. According to a report by the Center for Strategic and International Studies (CSIS), the Chinese company potentially has the capacity to produce up to one million Ascend 910C AI chips, thanks to the support of China’s leading semiconductor manufacturer, SMIC. While SMIC is not yet able to match Taiwan’s TSMC in cutting-edge technologies, it has obtained deposition tools and other equipment from the United States, overcoming a major bottleneck in the production of 7-nanometer semiconductors.

Although SMIC’s production capacity is smaller than TSMC’s, CSIS highlights how cooperation with Huawei could be a potential game-changer, especially for the adoption of EUV technology. SMIC currently aims to produce 50,000 wafers per month at 7nm by the end of 2025, a goal made possible by the acquisition of etching and deposition tools, obtained from Chinese companies such as SiEn and Pensun, which have circumvented US restrictions by declaring their use for less advanced 14nm processes.

In parallel, the report analyzes the role of NVIDIA GPUs in the Chinese AI landscape, highlighting how US restrictions have led the company to create the A800 and H800 GPUs, scaled down versions of the A100 and H100, to comply with export limits. These products, despite the modifications, have maintained adequate performance for the needs of Chinese AI, marginalizing the demand for the originally banned higher-end models. However, DeepSeek, a major Chinese AI company, has had to evaluate alternatives despite having exploited NVIDIA GPUs to avoid technological dependencies on the West. Huawei’s CANN ecosystem was among the options being considered, but industry sources say it would take years before it could compete with NVIDIA’s CUDA.

U.S. sanctions, aimed at limiting Huawei’s development of advanced chips, have also affected TSMC’s semiconductor supply. According to CSIS, before the restrictions, TSMC had already produced more than two million Ascend 910B logic dies for Huawei. Since the Ascend 910C consists of two 910B units, calculations suggest Huawei could assemble up to a million of these chips. However, the advanced packaging process introduces defects, reducing the final yield to 75%, a crucial figure for estimating the company’s actual production capacity.

Despite the restrictions and the lack of access to EUV equipment, SMIC continues to advance by leveraging older DUV technologies. CSIS notes that SMIC could improve its 7nm chip production yield, which is currently at 20% for fully functional components, with new equipment acquisitions. Industry sources say production capacity could reach 50,000 wafers per month by 2025, potentially resulting in 400,000 Ascend 910C chips per month. This development comes from the purchase of critical etching, deposition, and metrology equipment, which was completed in late 2024 and early 2025.

The report concludes that the scope for implementing export controls is rapidly shrinking, requiring immediate action to counter China’s technological advance.