TMTPOST -- Tencent   Holdings Ltd.   on Wednesday floated   enough   artificial   intelligence   ( AI )   chip   stockpile   and   many   alternatives,   playing down   the   potential   impact of pause   in   supply of Nvidia   Corporation's   H20 chips.

Credit：Tencent

"We do have enough chips for training and continuous upgrade of our existing models," Tencent President Martin Lau   told analysts   at an earnings call on Wednesday. Lau also said Tencent has "many options" when it comes to the chips for running AI models,   without   specifying   what kind of chips   on its list of potential   alternatives.

Lau ’ s remarks   came as Beijing is   becoming more   skeptical on the   security   of Nvidia ’ s H20, a   scaled-down AI   chip   that Nvidia   had specially tailored to the Chinese market to comply with the Biden-era AI chip export controls.  

Nvidia CEO Jensen   Huang   in   mid-July   said the U.S. government had   approved the resumption of H20 chip sales to China.   But China ’ s Cyberspace Administration   ( CAC )   on July   31   called Nvidia   representatives into a meeting to discuss what it deemed serious security vulnerabilities with the   H20 chip.   The agency asked staff to explain potential risks and provide documents as needed,   clouding   the outlook of H20 sales.  

U.S. President Donald Trump on Monday confirmed reports that Nvidia will be allowed to sell H20   chips to China, in exchange for giving the U.S. government 15% of the revenue they get from the sales.   A day later, Beijing was reported to have sent notices to domestic companies discouraging   use of the   less-advanced   semiconductors, particularly   strong   against the use of   Nvidia ’ s H20 chips   for government-related purposes.

Beijing   was also said to demand Chinese tech firms, including Alibaba and ByteDance, justify purchases of Nvidia ’ s H20 chips.   Tencent, as another Chinese tech   titan   focusing   on   AI   technology   and   accelerating spending   on AI research, still   heavily relies on Nvidia chips for the   training   of its   AI models,   The Information   cited the China ’ s   AI   industry insider   on Wednesday.   

Lau   on   the   earnings conference Wednesday said   the status of imports of AI chips   from U.S.   was unclear   yet   as Beijing and Washington continued negotiations, "We don't really have a definitive answer on the import situation yet. There are a lot of discussions between the two governments. We are waiting to see what exactly comes out of that,"   said Lau.

Lau implied   a   more measured approach   to   AI development than   many other   rivals   as Tencent   seeks   sustainable monetization   from   its AI initiatives. "We also have to be spending smartly, rather than just saying we ’ re going to go all-in and spend on buying a lot of chips, and sort of hiring a lot of people and doing a lot of marketing," said   Lau, adding that   Tencent will "spend in the right tempo."