China-based technology company ByteDance is developing an artificial intelligence chip and has entered manufacturing negotiations with South Korea's Samsung Electronics, according to a Reuters report published 11 February citing sources familiar with the matter.

ByteDance aims to receive sample chips by end-March and plans to produce at least 100,000 units of the chip, designed for AI inference tasks, during 2026. One source indicated production could progressively increase to 350,000 units. Negotiations with Samsung include access to memory chip supplies experiencing exceptional scarcity amid global AI infrastructure expansion.

The chip project, codenamed SeedChip, forms part of ByteDance's broader AI development strategy spanning chips to large language models. ByteDance plans to spend over 160 billion yuan (€19.51 billion) on AI-related procurement during 2026, with more than half allocated to purchasing Nvidia chips and advancing its in-house chip development.

"This acquisition represents a significant step forward in our strategy to grow in our core markets," said Sean Keohane, president and chief executive officer of Cabot Corporation, in a separate manufacturing development.

A ByteDance spokesperson stated the information about the company's in-house chip project is inaccurate, without elaborating. Samsung declined to comment on the negotiations.

Global technology companies including Alphabet's Google, Amazon and Microsoft have developed proprietary AI chips to reduce reliance on Nvidia, the dominant supplier of advanced chips for AI development. For Chinese technology companies, United States export controls on advanced chip sales to China have intensified urgency to develop domestic AI chip capabilities.

ByteDance's chip development efforts date to at least 2022, when the company began substantial chip-related hiring.

Explore the strategic implications of ByteDance's AI chip manufacturing initiative in the Reuters original article.