Demand for artificial intelligence chips has forced Huawei to slow down its smartphone production and reprioritize, writes Reuters.

The Chinese company uses one factory to produce both Ascend and Kirin AI chips used in smartphones. Due to limited capacity, the company has to slow down the production of Kirin chips to meet the demand for Ascend.

These changes were caused by the US restrictions on exports and imports of chips to China, which led the authorities to focus on domestic alternatives. At the same time, Ascend 910B is considered one of the most competitive chips.

For the first time since the end of 2022, the company was able to lead smartphone sales in the first weeks of 2024 in China thanks to the Mate 60 series. However, the race for AI chips and growing demand is forcing a shift in focus to their production.