China AI Chipmakers Hike Prices 50% Amid HBM Shortage

Chinese artificial intelligence semiconductor manufacturers, including Huawei and Cambricon, are raising processor prices by up to 50% as a severe global shortage of high-bandwidth memory threatens Beijing's push for technological self-reliance, according to a Reuters report.

The bottleneck in memory components is rippling across the domestic chip ecosystem, forcing major adjustments in pricing, release timelines, and supply chain allocations as domestic technology firms attempt to reduce their reliance on foreign hardware alternatives.

Huawei and Cambricon Implement Sharp Price Hikes

The pricing pressures are most acute among leading domestic accelerator developers attempting to scale production to meet intense local demand. Huawei has lifted the indicated price of its upcoming Ascend 950DT accelerator card to more than 250,000 yuan ($37,255), representing a 20% to 50% increase compared with quotes provided roughly two months prior.

Similarly, Cambricon has increased the indicated price of its planned 690 chip by 20% to 30%, while smaller domestic competitors MetaX and Iluvatar CoreX have introduced parallel price increases across their product portfolios, according to the Reuters report.

What Is High-Bandwidth Memory and Why Is It Scarce?

High-bandwidth memory (HBM) is a specialized type of dynamic random-access memory (DRAM) stacked vertically using through-silicon vias, allowing for exceptionally high data transfer rates essential for training and running large language models. The manufacturing process requires advanced packaging technologies like TSMC's Chip-on-Wafer-on-Substrate (CoWoS), which has faced prolonged global capacity constraints driven by unprecedented demand for Nvidia accelerators.

Because foreign suppliers face strict export controls and prioritize Western hyperscalers, Chinese semiconductor firms must rely on domestic memory suppliers or limited gray-market channels, leaving them particularly vulnerable to component shortages.

Supply Chain Adjustments and Shipment Reallocations

Despite the component constraints, development timelines and commercial deployment schedules continue to advance across the sector. Huawei's Ascend 950 series is scheduled to become available in the fourth quarter, while Cambricon's 690 chip remains unlaunched as developers navigate the higher component costs.

Meanwhile, supply chain shifts are underway to accommodate major enterprise buyers facing acute hardware deficits. Iluvatar CoreX has doubled its planned GPU shipments to ByteDance to 100,000 units this year, diverting processors originally intended for its own internal use to satisfy rising commercial demand amid intensifying computing constraints, according to the Reuters report.

What Is at Stake for China's Semiconductor Push

The rising hardware costs and component bottlenecks complicate Beijing's multi-billion-dollar initiative to establish an independent semiconductor supply chain capable of competing directly with global market leaders. As memory shortages inflate production costs for firms like Huawei and Cambricon, Chinese artificial intelligence developers face narrower margins and compressed deployment budgets, threatening the economic viability of domestic alternatives to restricted Western hardware.