Mumbai, February 11: ByteDance, the parent company of TikTok, is reportedly developing an in-house artificial intelligence chip and has entered negotiations with Samsung Electronics for its manufacture. Sources familiar with the matter indicate that the Beijing-based technology giant aims to receive sample chips by the end of March 2025. This move forms part of a broader strategy to secure a stable supply of advanced processors essential for its expanding AI infrastructure.

The company intends to produce at least 100,000 units of the new chip, specifically designed for AI inference tasks, this year. There are further plans to progressively increase production capacity to 350,000 units. While ByteDance has officially stated that reports regarding the in-house project are inaccurate, industry insiders suggest the project, codenamed SeedChip, is a central pillar of the company’s future business portfolio. TikTok-White House Deal Update: ByteDance Officially Divests US Operations to New American Joint Venture TikTok USDS, Chinese Engineers Won't Have Control Over Algorithm,

Strategic Partnership for Memory and Manufacturing

The potential agreement with Samsung Electronics is particularly significant due to the inclusion of high-bandwidth memory chip supplies. These components are currently facing a global shortage amid a large-scale expansion of AI infrastructure. By partnering with Samsung, ByteDance seeks not only a manufacturer for its logic chips but also a guaranteed pipeline for the memory units required to run large-scale AI models.

ByteDance has been building its semiconductor expertise since 2022 by hiring specialised staff. Previous reports in 2024 indicated that the company was collaborating with US-based Broadcom on an advanced processor, with initial plans to outsource production to TSMC. However, shifting to Samsung for this latest iteration could provide the company with greater flexibility in a constrained global market.

Competitive Landscape and Geopolitical Pressures

The push for custom silicon aligns ByteDance with global peers such as Google, Amazon and Microsoft, all of which have developed proprietary chips to reduce their dependence on Nvidia. For Chinese firms, this transition has also been driven by US export controls that restrict the sale of advanced AI chips to China. Developing domestic alternatives has become both a national and corporate priority to ensure long-term operational stability.

Significant Investment in AI Ecosystem

Despite the development of SeedChip, ByteDance remains a major consumer of external hardware. The company reportedly plans to spend more than CNY 160 billion, approximately USD 22 billion, on AI-related procurement this year. More than half of this budget is allocated to purchasing Nvidia chips, including the H200 models, while the remainder will support the advancement of its in-house semiconductor projects and large language models. India Ranks 3rd Globally in 2026 Global Vibrancy Index in AI Skills Penetration and Hiring.

During a recent internal meeting, ByteDance executives acknowledged that while their current AI models, such as the Doubao chatbot, may lag behind global leaders like OpenAI, the company remains committed to sustained investment. The aim is to integrate AI across all divisions, from short-form video and e-commerce to enterprise cloud services, ensuring the technology transforms every aspect of the ByteDance business.

(The above story first appeared on LatestLY on Feb 11, 2026 11:38 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).