{"id":137346,"date":"2025-09-12T09:12:07","date_gmt":"2025-09-12T09:12:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/137346\/"},"modified":"2025-09-12T09:12:07","modified_gmt":"2025-09-12T09:12:07","slug":"alibaba-and-baidu-turn-to-own-chips-trouble-ahead-for-nvidia","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/137346\/","title":{"rendered":"Alibaba and Baidu Turn to Own Chips \u2014 Trouble Ahead for Nvidia?"},"content":{"rendered":"

Chinese firms Alibaba (BABA)<\/a> and Baidu (BIDU)<\/a> have started using their own chips to train artificial intelligence<\/a> models, according to The Information. The move partly reduces reliance on Nvidia (NVDA)<\/a>, which has long been the leading supplier of AI<\/a> processors in China, and raises fresh questions about how much of Nvidia\u2019s China business could be at risk.<\/p>\n

Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! <\/a> Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.<\/p>\n

Alibaba has already used its in-house chips for smaller AI models this year, while Baidu is testing its Kunlun P800 chip to power new versions of its Ernie model. Both companies still use Nvidia chips for their most advanced projects, but the shift shows how local players are working to cut dependence on U.S. technology.<\/p>\n

Export Limits Push Local Chip Use<\/p>\n

The change follows tighter U.S. export rules that restrict Nvidia from selling its most powerful processors in China<\/a>. The H20 chip, the strongest model it can still supply, is less capable than the flagship H100 or the new Blackwell series.<\/p>\n

Even so, Alibaba\u2019s chip is now seen as competitive with the H20, according to employees cited in the report. Baidu\u2019s Kunlun line also reflects Beijing\u2019s push for companies to adopt home-grown chips to secure supply chains and reduce reliance on U.S. suppliers.<\/p>\n

Nvidia Faces Business Risk in China<\/p>\n

China has been a key market for Nvidia, but demand could weaken if Alibaba and Baidu continue to scale their in-house chips. The Information predicts Nvidia\u2019s China sales may shrink further, adding pressure from U.S. trade restrictions.<\/p>\n

Nvidia has acknowledged the rising challenge. In response to the report, a company spokesperson said, \u201cThe competition has undeniably arrived.\u201d CEO Jensen Huang recently added that talks with the U.S. government on licensing a scaled-down version of its next-generation chip for China would take time.<\/p>\n

Analysts Weigh the Impact<\/p>\n

While Alibaba and Baidu are unlikely to drop Nvidia entirely, their growing use of self-designed processors could limit Nvidia\u2019s growth in the region.<\/p>\n

For investors, the key question is whether Nvidia can offset weaker China sales with demand elsewhere, particularly as global AI buildouts continue.<\/p>\n

Which Stock Is the Best Buy?<\/p>\n

Turning to Wall Street,\u00a0out of the three stocks mentioned above,\u00a0analysts see the most upside in Nvidia. The NVDA stock average price target<\/a> of $210.95 suggests nearly 19% upside from current levels. Meanwhile, the BABA stock average price target<\/a> of $165.69 implies about 6.6% upside. On the other hand, the BIDU stock average price target<\/a> of $104.19 points to a 6.8% downside from current prices.<\/p>\n

\"\"<\/a><\/p>\n

Disclaimer & Disclosure<\/a>Report an Issue<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Chinese firms Alibaba (BABA) and Baidu (BIDU) have started using their own chips to train artificial intelligence models,…\n","protected":false},"author":2,"featured_media":137347,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[256,254,255,64,63,105],"class_list":{"0":"post-137346","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-au","12":"tag-australia","13":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/137346","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=137346"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/137346\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/137347"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=137346"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=137346"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=137346"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}