Growing demand for artificial intelligence (AI) chips, paired with production limits, has led Huawei to tilt its focus toward AI work while slowing the output of its premium Mate 60 smartphones, according to Reuters.
The company now faces a key choice between Ascend AI chips and Kirin processor chips because both rely on the same manufacturing line. This tug-of-war comes even as Huawei’s newest Mate 60 flagship has found strong traction within China, underscoring a market that is increasingly hungry for AI-enabled devices. The scaling of AI chip production is seen as a more lucrative opportunity, potentially delivering substantial profits for the company as demand continues to rise.
The surge in demand for AI chips is linked to tighter export controls on American semiconductor technology to China. Beijing has responded by backing domestic chip development and procurement, notably favoring Huawei’s Ascend line of AI processors. Reuters notes that Huawei’s most competitive neural processing unit in the current lineup is the Ascend 910B, a model that has drawn particular attention in industry circles.
Huawei is actively working to upgrade its manufacturing ecosystem to boost chip output. In this effort, the company receives support from SMIC, China’s leading semiconductor producer, which is helping to scale production capacity and improve process efficiency across the board.
Huawei has not commented publicly on these market dynamics or the production strategy at this time.
Beyond Huawei, the broader tech sector is observing a shift in demand for AI-related skills and capabilities, with such expertise increasingly requested by employers across different regions, including Russia’s growing tech landscape. The movement signals a global trend where AI expertise is becoming a critical differentiator for firms aiming to stay competitive in rapidly evolving markets.