ByteDance, the Chinese company that owns TikTok, is collaborating with US chipmaker Broadcom on its own artificial intelligence processor (NPU), Reuters reports.

According to anonymous sources, the 5-nanometer chip – an application-specific integrated circuit (ASIC) – will comply with US export restrictions, and its production will be outsourced to Taiwan’s TSMC.

Since the U.S. imposed semiconductor export controls in 2022, there have been no publicly announced collaborations between Chinese and U.S. companies in chip development. U.S.-China agreements in this sector tend to be less sophisticated.

ByteDance’s collaboration with Broadcom will help reduce procurement costs and ensure a steady supply of high-end chips, according to sources who declined to be identified due to the sensitivity of semiconductor issues in China.

However, they said, TSMC is not expected to begin production of the new chip this year. One of them said that although design is well underway, the “tapeout,” which marks the end of the design phase and the start of production, has not yet begun.

Like many other global tech companies, ByteDance is trying to develop the artificial intelligence industry, but most of the world’s best practices are not available to it, as well as other Chinese companies.

NVIDIA’s most advanced chipsets, for example, are not available to Chinese companies because of U.S. export controls aimed at preventing breakthroughs in artificial intelligence and supercomputing by the Chinese military.

ByteDance and Broadcom have been business partners since at least 2022. The Chinese company has already purchased a high-performance 5nm Tomahawk chip switch, as well as a Bailly switch for computer clusters with artificial intelligence.

In addition to TikTok and its Chinese version Douyin, ByteDance also owns other popular projects in China, such as Doubao, a ChatGPT-like chatbot service with 26 million users.

According to one person briefed on the matter, ByteDance was still able to purchase NVIDIA chips to support its AI advancement. These include the A100 and H100 chips that were available for the Chinese market before the first round of US sanctions were imposed, as well as the A800 and H800 chips that NVIDIA produced specifically for the Chinese market, but which were also later restricted.

It is reported that in 2023 alone, ByteDance has allocated $2 billion for the purchase of NVIDIA chips.

Last year, ByteDance also acquired Huawei Ascend 910B chips. The company has posted hundreds of semiconductor-related job openings, including 15 vacancies for ASIC developers.