Tencent and Baidu, two of China’s largest technology companies, revealed how they’re keeping in the global artificial intelligence race even as the U.S. tightens some curbs on key semiconductors.
The business’ methods include stockpiling chips, making AI models more efficient and even using homegrown semiconductors.
Big names in the sector addressed the issue during their latest earnings conference calls.
Martin Lau, president of Tencent — the operator of China’s biggest messaging app WeChat — said his company has a “pretty strong stockpile” of chips that it has previously purchased. He was referring to graphics processing units (GPUs), a type of semiconductor that has become the gold standard for training huge AI models.
These models require powerful computing power supplied by GPUs to process high volumes of data.
But, Lau said, contrary to American companies’ belief that GPU clusters need to expand to create more advanced AI, Tencent is able to achieve good training results with a smaller group of such chips.
“That actually sort of helped us to look at our existing inventory of high-end chips and say, we should have enough high-end chips to continue our training of models for a few more generations going forward,” Lau said.
Regarding inferencing — the process of actually carrying out an AI task rather than just training — Lau said Tencent is using “software optimization” to improve efficiency, in order to deploy the same amount of GPUs to execute a particular function.
Lau added the company is also looking into using smaller models that don’t require such large computing power. Tencent also said it can make use of custom-designed chips and semiconductors currently available in China.
“I think there are a lot of ways [in] which we can fulfill the expanding and growing inference needs, and we just need to sort of keep exploring these venues and spend probably more time on the software side, rather than just brute force buying GPUs,” Lau said.
Baidu’s approach
Baidu, China’s biggest search company, touted what it calls its “full-stack” capabilities — the combination of its cloud computing infrastructure, AI models and the actual applications based on those models, such as its ERNIE chatbot.
“Even without access to the most advanced chips, our unique full stack AI capabilities enable us to build strong applications and deliver meaningful value,” Dou Shen, president of Baidu’s AI cloud business, said on the company’s earnings call this week.
Baidu also touted software optimization and the ability to bring down the cost of running its models, because it owns much of the technology in that stack. Baidu management also spoke about efficiencies that allow it to get more out of the GPUs it possesses.
“With foundation models driving up the need for a massive computing power, the abilities to build and manage large scale GPU clusters and to utilize GPUs effectively has become key competitive advantages,” Shen said.
The Baidu executive also touted the progress made by domestic Chinese technology firms in AI semiconductors, a move he said would help mitigate the impact of U.S. chip curbs.
“Domestically developed self-sufficient chips, along with [an] increasingly efficient home-grown software stack, will jointly form a strong foundation for long-term innovation in China’s AI ecosystem,” Shen said.
China domestic chip focus
China has been ramping up development of chips designed and manufactured on its home soil for the last few years. Most experts agree that Beijing remains overall behind the U.S. in the realm of GPUs and AI chips, but there have been some advances.
Gaurav Gupta, an analyst covering semiconductors at Gartner, said stockpiling is one way Chinese companies are dealing with export restrictions. Additionally, there has been some progress made in semiconductor technology in China, even if it remains behind the U.S., Gupta added.
“China has also been developing its own domestic semiconductor ecosystem, all the way from materials to equipment to chips and packaging. Different segments have made varying levels of progress, but China has been surprisingly extremely consistent and ambitious in this goal, and one must admit that they have achieved decent success,” Gupta told CNBC by email.
“This provides an avenue for them to procure AI chips, which perhaps can’t compete with those from the U.S chip leaders but continue to make progress.”
Many U.S. executives have urged Washington to scrap export restrictions in light of China’s progress. Nvidia CEO Jensen Huang called the curbs a “failure” this week, saying they are doing more damage to American businesses than to China.
U.S. President-elect Donald Trump greets Elon Musk as he arrives to attend a viewing of the launch of the sixth test flight of the SpaceX Starship rocket on November 19, 2024 in Brownsville, Texas.
Brandon Bell | Getty Images News | Getty Images
NASA is requiring employees involved in Artemis missions with contractors SpaceX and Blue Origin to stay on the job during the government shutdown, CNBC has learned.
Their work will be unpaid during the shutdown furlough, but employees should record their time, NASA Chief Human Capital Officer Kelly Elliott wrote in an email to staffers on Wednesday. NASA employees are expected to receive pay for their work after a reopening.
In a separate memo from Monday, NASA’s acting finance chief, Steve Shinn, laid out details about missions that would be supported during a shutdown.
NASA will continue to support “planned operations” of the International Space Station, as well as any satellite mission that “is in the operations phase,” Shinn wrote. He added that NASA would support “Artemis operations during any funding lapse,” including employees and contractors working on those projects.
Shinn said NASA would furlough around 15,000 people and require around 3,000 staffers to keep working, part time or full time, during the shutdown.
The U.S. government’sshutdown began early Wednesday morning, setting the stage for the furlough of hundreds of thousands of federal workers and the closing of a number of key programs and services. Government employees who are considered “essential,” like Transportation Security Administration (TSA) officers and air traffic controllers, are required to continue working.
On its website, NASA describes Artemis as a campaign to “send astronauts to explore the Moon for scientific discovery, economic benefits, and build the foundation for the first crewed missions to Mars.” The memos this week didn’t name the contractors associated with the various Artemis missions.
SpaceX, which is helmed by Elon Musk, won major Artemis contracts with its Starship rocket, the tallest and most powerful rocket ever launched. SpaceX has flown its full Starship rocket system on 10 test flights since April 2023, and plans to conduct another on Oct. 13. Its prior Starship test flights included five failures, a partial failure and four successes.
Blue Origin, owned by Amazon founder Jeff Bezos, was given another Artemis contract, and work on its lunar lander will also continue during the shutdown, NASA employees told CNBC.
Artemis III, scheduled for 2027, will be the first to involve SpaceX directly. The mission would land two NASA astronauts on the south polar region of the Moon.
Early Artemis missions involved NASA working with Lockheed Martin and Boeing to design, build, analyze and then buy rockets that the agency would own outright. With Artemis II, which is scheduled for early 2026, NASA aims to send four astronauts around the moon without landing before returning to Earth.
And the goal of Artemis IV+ HLS, with SpaceX, is to put astronauts into the first lunar space station, helping NASA and its partners to prepare for an eventual human mission to Mars. Artemis V is expected to involve Blue Origin.
Neither SpaceX nor Blue Origin has finalized the design of their lunar landers, and so far have only built test hardware.
Representatives of NASA, SpaceX and Blue Origin didn’t immediately respond to a request for comment. An autoreply from NASA said the agency “is closed due to a lapse in government funding.”
“I am in furlough status; therefore, I am unable to respond to your message at this time,” said the message from Cheryl Warner, news chief in NASA’s communications office.
Thomas Kurian, CEO of Google Cloud, speaks at a cloud computing conference held by the company in 2019.
Michael Short | Bloomberg | Getty Images
Google has laid off more than 100 employees in design-related roles, CNBC has learned.
Earlier this week, the company laid off employees within the cloud unit’s “quantitative user experience research” teams and “platform and service experience” teams, as well as some adjacent teams, according to internal documents viewed by CNBC.
The roles often focus on using data, surveys and other tools to understand and implement user behaviors that inform product development and design.
Google has halved some of the cloud unit’s design teams, and many of those affected are U.S.-based roles. Some employees have been given until early December to find a new role within the company.
The company did not immediately respond to CNBC’s request for comment. Business Insider first reported that some cloud roles were eliminated.
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The latest layoffs come as Google accelerates cuts to focus spending on artificial intelligence infrastructure.
Since the beginning of the year, the search giant has offered voluntary exit packages to many U.S.-based units across the company and eliminated more than one-third of its managers overseeing small teams.
It also recently began pushing employees to use more AI in their daily work.
So far, the company has offered buyouts to U.S.-based employees from units such as human resources, hardware, search, ads, marketing, finance and commerce divisions.
CNBC reported in August that Google CEO Sundar Pichai told employees the company would need “to be more efficient as we scale up so we don’t solve everything with headcount.”
Other megacaps have also seen recent cuts.
In July, Microsoft laid off 9,000 employees across roles and geographies. Meta has also had layoffs.
Intel’s CEO Lip-Bu Tan speaks at the company’s Annual Manufacturing Technology Conference in San Jose, California, U.S. April 29, 2025.
Laure Andrillon | Reuters
Intel is in early talks with AMD to manufacture chips for it in its foundry business, according to a report from Semafor.
Intel shares rose 7% on Wednesday. AMD shares were up over 1%.
If AMD were to start manufacturing chips with Intel, it would be a significant win for the company’s foundry business, which is currently seeking big customers. Analysts say that a big customer would allow Intel Foundry to confidently invest in developing its manufacturing technology and would send a signal to other chip companies that Intel can handle their business.
It would also signal that AMD, which competes with Intel in x86-based chips for PCs and servers, is confident doing its manufacturing with its biggest competitor.
It is unclear how much manufacturing AMD would do with Intel, according to the report by Semafor’s Rohan Goswami. AMD currently manufactures its chips with TSMC.
In recent weeks, Intel has added several significant investors, including the U.S. government, Nvidia, and Softbank, which were all seen as votes of confidence as the company attempts to turn around its fortunes under new CEO Lip-Bu Tan. However, Nvidia did not commit to using Intel’s foundry.
Intel shares are up nearly 77% so far in 2025 as investors gain more confidence in the chipmaker.
A representative for Intel declined to comment.
“AMD does not comment on rumor or speculation,” an AMD spokeperson said.