Huawei’s AI Chip Plans Pushed 3 Generations Behind NVIDIA Due To US Sanctions

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Chinese technology giant Huawei is struggling to make advanced chips capable of supporting artificial intelligence workloads and meeting the performance of NVIDIA’s older products due to US sanctions, according to sources quoted by Bloomberg. US sanctions under the Trump and Biden administrations have prevented Taiwan’s TSMC from selling its most advanced chips to China and limited Chinese chip manufacturers’ ability to procure the latest chip manufacturing machines from the Dutch firm ASML.

As these machines are indispensable to making newer chips, Huawei’s plans to develop its new chips capable of supporting AI workloads are limited to the 7-nanometer node and will continue to be so for the next two years.

Chinese Chip Manufacturers Struggle With Multi-Patterning To Make The Latest Chips

NVIDIA’s latest AI chips, the H100 lineup, rely on TSMC’s N4 process technology family for fabrication. The N4, or the 4-nanometer process, is an advanced variant of TSMC’s 5-nanometer and it is more than a generation ahead of TSMC’s 7-nanometer technology. Yet, the Biden administration’s sanctions against China’s SMIC which prevent it from procuring ASML’s latest extreme ultraviolet (EUV) chip manufacturing machines have limited SMIC from moving below the 7-nanometer process to more advanced technologies, reports Bloomberg.

Since ASML is the only company in the world which provides these machines, SMIC’s options are limited to using older scanners that rely on deep ultraviolet (DUV) lithography. Consequently, as per the unnamed sources, the Chinese firm has had to resort to multi-patterning to try to churn ou 7-nanometer chips.

In semiconductor fabrication, multi-patterning divides a mask (equipment with the circuit design) into parts to ‘print’ one part at a time on silicon and achieve the crisp resolution necessary for smaller feature sizes. Consequently, the process adds complexity to semiconductor fabrication, increases production time and presents quality problems.

According to today’s report, China’s leading chip manufacturer SMIC is also suffering from these issues. The problems have arisen because US sanctions have left it unable to procure advanced EUV machines from ASML, and the resulting shift to DUV machines has made manufacturing the latest chips difficult. Not only is SMIC relying on multi-patterning to overcome the restrictions, but the government’s pressure to use local equipment has also left it struggling to keep up with old Western chip manufacturing technologies.

As a result, as it is cut off from TSMC’s latest chip process families, Huawei has been forced to rely on SMIC’s products and design its chips around the older 7-nanometer process. However, with TSMC set to produce 2-nanometer chips next year and SMIC struggling with multi-patterning and domestic chip manufacturing equipment, Huawei’s plans to self-develop AI processors are struggling.

These difficulties not only hamper Huawei’s competitiveness in the consumer electronics market, where it has to face off with rivals such as Apple, but they also hamper Chinese attempts to develop semiconductor self-sufficiency in the AI era and remain at par with the United States. Apple’s iPhone smartphones regularly use TSMC’s latest products, with the 2024 iPhone relying on chips made through the 3-nanometer process technology family.