DeepSeek is developing its own AI chip to cut its reliance on Nvidia and Huawei, three people familiar with the matter told Reuters. The chip targets inference — running trained models — rather than training new ones.

The effort is still early: DeepSeek is in talks with chip-design, foundry and memory firms and has quietly hired chip engineers. Domestic rivals Alibaba and Baidu are already building their own AI chips. Huawei now holds about half of China's $50B domestic AI chip market after U.S. curbs on Nvidia exports.