Chinese tech giants are increasingly focusing on domestic computing solutions. Recently, Alibaba’s self-built Zhenwu chip has been claimed to match the performance of NVIDIA’s H20 AI chip.

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### Alibaba & Baidu Shift to In-House AI Chips

There is a growing push in China to move away from Western AI technologies, with companies like Huawei, Alibaba, and Baidu developing their own specialized solutions for inference or training workloads. According to a report by The Information, both Alibaba and Baidu have started using in-house AI chips for model training. Specifically, Alibaba’s Zhenwu chip is said to rival NVIDIA’s H20 in performance.

> “For example, Alibaba’s AI chip is now good enough to compete with Nvidia’s H20 chip, the scaled-down chip designed for the Chinese market,” — The Information

Relative to NVIDIA’s solutions, Chinese firms are significantly behind in both technological innovation and production capacity. However, considering China’s push toward domestic solutions and the progress made over a few years, Alibaba’s achievement is substantial.

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October 8, 2025

Baidu has also employed the Kunlun P800 chip for model training and inference workloads, further highlighting the competition facing NVIDIA’s tech stack in China.

### Challenges for NVIDIA

Currently, NVIDIA faces difficulties accessing China’s AI market. Beijing has imposed restrictions, putting the firm in a challenging position. Rumors suggest that NVIDIA is working on a “Blackwell-based” solution for domestic markets, known as the B40 AI chip, but these plans are not yet official and will likely require Jensen Huang to convince the Trump administration to allow high-end sales to China.

In summary, Alibaba’s Zhenwu chip represents a significant milestone in China’s tech industry, challenging Western dominance in AI technologies.