According to reports, Chinese company ByteDance (parent company of TikTok) is collaborating with US chip manufacturer Broadcom (NASDAQ: AVGO) to develop advanced AI processors. This initiative aims to ensure ByteDance can secure stable access to AI chips amid strict US export restrictions on Chinese chips.

The newly developed 5nm chips will comply with US export restrictions and could potentially be manufactured by TSMC (NASDAQ: TSM), the world's largest contract chipmaker. ByteDance has established a partnership with Broadcom and has purchased multiple AI chips from them over the past two years.

With the US blocking several major chip manufacturers, notably Nvidia (NASDAQ: NVDA), from selling advanced AI technology to China, this collaboration between ByteDance and Broadcom demonstrates Chinese tech firms' determination to secure a supply of advanced AI chips. While Nvidia is still permitted to sell less advanced AI chips in China, these products have faced relatively weak market reception, especially compared to local competitors like Huawei.

Over the past year, applications of AGI (such as OpenAI's ChatGPT) have driven widespread adoption of AI technology. Reports indicate ByteDance is actively developing its own AGI platform. AI has become a major demand driver for global chip manufacturers, prompting Broadcom to revise its annual profit expectations upwards.

This collaboration not only showcases ByteDance's strategic investment in AI technology but also reflects changes in the global chip market's response strategies and market demand amidst export control challenges.