ByteDance Negotiates Purchase of Iluvatar CoreX GPUs

ByteDance is in talks to buy at least 50,000 AI chips from Shanghai-based Iluvatar CoreX for inference workloads powering its Doubao chatbot, Reuters reports. If completed, the deal would make Iluvatar CoreX ByteDance's third major domestic GPU supplier after Huawei and Cambricon, marking a significant commercial milestone for the chipmaker. Iluvatar CoreX shares rose 12% in Hong Kong following the report.

ByteDance Negotiates Purchase of Iluvatar CoreX GPUs Reuters reports ByteDance is in talks to buy at least 50,000 AI chips from Shanghai-based Iluvatar CoreX, primarily for inference workloads powering its Doubao chatbot. Two sources told Reuters the deal, if completed, would make Iluvatar CoreX ByteDance's third major domestic GPU supplier after Huawei and Cambricon; ByteDance is also evaluating Baidu's Kunlunxin chips, while Tencent is already a Kunlunxin customer. Iluvatar CoreX, which listed on the Hong Kong exchange in January 2026 and reported 1 billion yuan $148 million in 2025 revenue, has until now mainly supplied government procurement projects - making a ByteDance deal a significant commercial milestone, per Reuters' sources. Huatai Securities projects Iluvatar's 2026 revenue at 3.04 billion yuan $449.8 million , with chip shipments jumping 139%. Iluvatar shares rose 12% in Hong Kong on the Reuters report. Deal details remain subject to change and none of the companies commented. What happened According to Reuters, ByteDance is in talks to purchase at least 50,000 AI chips from Shanghai-based Iluvatar CoreX, to be deployed primarily for inference workloads. Reuters cites two sources who declined to be named as the discussions are not public. The chips are intended to expand serving capacity for Doubao, ByteDance's signature AI chatbot, the sources told Reuters. ByteDance is simultaneously evaluating Baidu's Kunlunxin chips for similar inference use; Tencent is already a Kunlunxin customer, per the same sources. ByteDance, Iluvatar CoreX, Baidu, and Tencent did not respond to Reuters' requests for comment. The deal details are not final and remain subject to change. Commercial context Reuters describes a deal with ByteDance as a significant commercial milestone for Iluvatar CoreX. Per one of Reuters' sources, the company has until now mainly supplied government procurement projects. Iluvatar CoreX listed on the Hong Kong Stock Exchange in January 2026 and reported 1 billion yuan $148 million in 2025 revenue, approximately 90% from GPU sales. Analysts at Huatai Securities project 2026 revenue at 3.04 billion yuan $449.8 million , with total chip shipments expected to jump 139% to over 100,000 units. The bank estimates Iluvatar's Zhikai inference chips carry an average selling price of about 12,000 yuan approximately $1,775 each . Iluvatar CoreX shares rose 12% in Hong Kong following the Reuters report. Product context Iluvatar CoreX makes two chip lines: the Tiangai series, designed for AI training workloads, and the Zhikai series, which targets inference tasks. The Zhikai would be the likely product for a ByteDance deployment. Inference workloads involve serving responses to end-user queries and differ from model training in that they prioritize cost-efficiency, latency, and throughput-per-chip over peak compute. If a deal is agreed, Iluvatar CoreX would become ByteDance's third major domestic GPU supplier after Huawei and Cambricon. Broader market context Reuters reported in April that Chinese GPU and AI chipmakers captured nearly 41% of China's AI accelerator server market last year, significantly eroding Nvidia's position in one of its most important overseas markets. Nvidia CEO Jensen Huang has stated that the company's market share in China has effectively fallen to zero, per Reuters. Tencent's Chief Strategy Officer James Mitchell separately said in May that Chinese AI chips would be available in large quantities in the second half of 2026, per Reuters. Beijing has promoted domestic semiconductor adoption as a strategic priority, particularly under U.S. export controls on advanced AI chips. What to watch For infrastructure and procurement teams: official announcements from ByteDance or Iluvatar CoreX confirming volumes and shipment timelines; independent performance and efficiency benchmarks for the Zhikai inference chip at serving scale; software ecosystem readiness drivers, compilers, and transformer-inference kernels ; and whether other major Chinese internet companies disclose comparable domestic-chip procurement decisions. Scoring Rationale A Reuters exclusive on ByteDance's negotiations to purchase 50,000 chips from Iluvatar CoreX marks a landmark shift: a leading Chinese GPU startup transitioning from government-only procurement to commercial internet-scale deployment, in a market where Chinese GPU makers now hold 41% share and Nvidia's CEO has acknowledged the company's China position has fallen to effectively zero. The story moved Iluvatar's shares 12% and carries strategic significance for AI infrastructure practitioners. Held at 7.0 rather than higher because the deal is not yet finalized and Iluvatar is not yet a proven at-scale commercial supplier. Practice interview problems based on real data 1,500+ SQL & Python problems across 15 industry datasets — the exact type of data you work with. Try 250 free problems /problems