Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker, has suspended shipments to Chinese semiconductor firm Sophgo after discovering a TSMC-manufactured chip on Huawei’s AI processor, Ascend 910B, according to sources familiar with the issue.
The suspension follows a report by tech research firm TechInsights, which found a TSMC chip on Huawei’s latest AI processor after disassembling it. Sophgo, a Chinese firm tied to cryptocurrency mining giant Bitmain, had previously ordered chips similar to those discovered in Huawei’s Ascend 910B. However, Sophgo claims it has no business dealings with Huawei, stating on its website that it complies with all applicable laws and had provided TSMC with a report affirming no connection with Huawei.
Sophgo, co-founded by Micree Zhan, who also co-founded Bitmain, maintains that it followed all legal guidelines and denies any relationship with Huawei. In 2023, the company communicated with the U.S. Federal Communications Commission under the name Xiamen Sophgo Technologies Ltd. and using a Bitmain email address. Notably, in 2021, Taiwanese prosecutors raided Bitmain-affiliated operations in Taiwan, leading to guilty pleas and fines for four Taiwanese employees over illegal recruitment of semiconductor engineers.
TSMC, which has refrained from working with Huawei since September 2020, alerted both Taiwan and U.S. authorities of the discovery and subsequently launched an investigation. TSMC confirmed it “proactively communicated” with the U.S. Commerce Department about the incident, although it stated that it is not currently under investigation. Huawei has also affirmed it has not sourced chips from TSMC since 2020 due to U.S. trade restrictions, which bar the sale of foreign-produced products incorporating U.S. technology to Huawei.
This incident comes amid heightened scrutiny of technology exports to China, particularly as Chinese firms pursue AI chip advancements. The Research Institute for Democracy, Society, and Emergency Technology (DSET) in Taiwan reported in August that Bitmain, Sophgo’s affiliate, is aiming to compete in the AI chip sector dominated by industry giants Nvidia and AMD.
