Huawei revamps cloud computing unit to prioritise AI amid China-US tech war

Huawei Technologies has begun a major restructuring of its cloud computing unit as the Chinese tech giant sharpens its focus on artificial intelligence amid the Sino-US tech war, according to sources and Chinese media reports.

The subsidiary - responsible for AI model development, cloud services and data centre solutions - kicked off the restructuring on Friday, merging several key departments to prioritise AI-related business, according to two employees involved, who requested anonymity because the information was private.

It remains unclear how many employees will be affected by the changes as many may have the opportunity to transfer internally, one source said.

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The Huawei Cloud Business Unit told Chinese media National Business Daily on Monday that the purpose of the restructuring was to "continue to create more advanced and valuable cloud services for customers through software and hardware collaboration and architectural innovation", adding that it would invest more resources in AI and computing industries.

The changes were announced internally by Zhang Pingan, CEO of Huawei's cloud unit. After the revamp, the cloud unit's core operations would be streamlined into six divisions, including computing, storage, database and cybersecurity, according to a report from Chinese news portal Sina.com on Saturday.

The restructuring is part of the unit's efforts to achieve profitability following losses last year, according to Sina.

Huawei did not immediately respond to a request for comment on Monday.

Huawei's CloudMatrix 384 system, a rival to the structure used in Nvidia's NVL72 system. Photo: Reuters alt=Huawei's CloudMatrix 384 system, a rival to the structure used in Nvidia's NVL72 system. Photo: Reuters>

The move comes as the US-sanctioned company doubles down on its efforts to provide AI hardware and software services in response to soaring demand, as it continues to navigate Washington's restrictions on China's access to advanced chips, particularly those from Nvidia.

Earlier this year, Huawei launched its CloudMatrix 384 computer system, which was widely viewed as a challenge to Nvidia's dominance in China.

It also open-sourced its Compute Architecture for Neural Networks tool kits - competitors to Nvidia's Compute Unified Device Architecture - and introduced the Unified Cache Manager, an algorithm designed to reduce dependence on expensive high-bandwidth memory chips.

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In 2024, Huawei's revenue from its cloud computing business reached 68.8 billion yuan (US$9.6 billion), accounting for nearly 10 per cent of its total revenue, according to its annual report.

Meanwhile, talent working at Huawei, which is regarded as a symbol of national pride, remains highly sought after by other top Chinese tech companies.

Over the weekend on the Chinese social media platform RedNote, individuals claiming to be human resources representatives from firms like Alibaba Group Holding and ride-hailing service Didi Chuxing touted attractive job offers for employees leaving Huawei. Alibaba owns the Post.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.

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