Huawei has reportedly slowed its production rate for its premium Mate 60 phones as the company faces a surge in demand for AI chips. 

According to the people familiar with the matter, Huawei has only one facility that handles the production of its Ascend AI chips and the Kirin chips. 

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Huawei's Production on Slow Rate 

Despite the soaring demand for AI-powered smartphones, Huawei has been facing a slow production rate. The Ascend 910B chip is used for training AI models and is known for its competitive stand as the non-NVIDIA chip available in China. 

According to Reuters' sources, Huawei is working to improve its yield rate and has prioritized the production of Ascend chips over Kirin chips, resulting in the slow manufacturing of the Mate 60 model. 

Chinese AI companies have been struggling to source popular AI chips like the NVIDIA H100 after the United States placed restrictions on chip exports. This pushed Chinese companies to develop a domestic alternative like Huawei's Ascend 910B chip. 

Huawei Dethrones Apple in China Sales 

In 2023, Huawei had officially beat Apple's iPhone sales in China. According to the analysts, there has been a double-digit growth in Android sales by Huawei, Xiaomi, and Honor devices. 

On the other hand, Apple had a significant double-digit decline in its iPhone sales. Analysts have also predicted that iPhone will still "lose" the top spot to Huawei next year. Huawei remained China's top-selling smartphone for the first two weeks of 2024. 

When it comes to chip manufacturing, Huawei has been lowkey on its capability and ambition, making it hard to predict the company's progress in producing advanced chips. The release of the Mate 60 series proved its powerful potential to compete with leading U.S. companies. 

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