Alibaba admits the nearly 500,000 chips it made are weaker than NVIDIA's

Alibaba, the Chinese web giant, has confirmed that its semiconductor arm has produced nearly 500,000 chips, but all of them lag the competition in performance.

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T-Head, the Alibaba-owned semiconductor company, recently held its Q3 2026 earnings call, during which CEO Yongming Wu said the company has produced nearly 470,000 chips and has at least three chip designs tailored for AI workloads: the XuanTie C908, the TH1520 for edge AI, and the Pingtouge Zhenwu 810E. If these figures from T-Head's CEO are accurate, Alibaba can produce an impressive number of chips, as its production capabilities are now in line with NVIDIA's. Team Green's CEO said last year that NVIDIA was able to produce 6 million Blackwell GPUs in 12 months.

However, production capacity isn't the be-all and end-all of chip production; performance is the other half of the coin, and, unfortunately for Alibaba, T-Head chip performance falls short of foreign competitors'. Wu acknowledged the performance difference between T-Head chips and the competition, saying, "Given that our chips still lag behind foreign counterparts and performance in various respects, we aspire to engage in more profound co-design with Alibaba's cloud infrastructure and the Qwen model to provide improved cost effectiveness."

Adding, "This is one key differentiator and how we approach chip design at T-Head that sets us apart from other chip companies. Our primary goal is to create AI capabilities that offer superior value for money."