Finance

Alibaba-affiliate Ant uses Chinese, U.S. chips to cut AI costs

Published

3 months ago

March 24, 2025

Business Finance News

A view of the Ant Group buildings in Chongqing, China on March 23, 2025.

Cfoto | Future Publishing | Getty Images

BEIJING — Alibaba-affiliate Ant Group is using both Chinese and U.S.-made semiconductors for building more efficient artificial intelligence models, according to a source familiar with the matter.

The combination of chips not only reduces the time and cost of training AI models, but also limits reliance on a single supplier such as Nvidia, the source said, noting the industry trend of tapping multiple networks, known as mixture of experts — a technique that allows models to be trained with much less compute.

The company earlier this month said in a paper it was able to use lower-cost hardware to effectively train its own MoE models, reducing computing costs by 20%.

Ant operates Alipay, one of the two major apps for mobile payments in China. Jack Ma founded the company and its affiliate, Alibaba.

Bloomberg reported Monday, citing sources, that Ant has used chips from Alibaba and Huawei for training AI models. Ant also used Nvidia chips but now relies more on alternatives from Advanced Micro Devices and Chinese chips, according to the Bloomberg report.

Ant did declined CNBC’s request for comment.

The company on Monday announced “major upgrades” to its AI solutions for healthcare, which it said were being used by seven major hospitals and healthcare institutions in Beijing, Shanghai, Hangzhou and Ningbo.

The healthcare AI model is built on DeepSeek’s R1 and V3 models, Alibaba’s Qwen and Ant’s own BaiLing. Ant’s healthcare-specific model is able to answer questions about medical topics, and can also help improve patient services, according to the company statement.

The U.S. has sought to restrict China’s AI development by limiting Chinese businesses’ access to the most advanced semiconductors used for training models. Nvidia can still sell its lower-end chips to China.

Finance

Stocks making the biggest moves midday: WOOF, TSLA, CRCL, LULU

Published

1 day ago

June 6, 2025

Business Finance News

Finance

Swiss government proposes tough new capital rules in major blow to UBS

Published

1 day ago

June 6, 2025

Business Finance News

A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.

Fabrice Coffrini | AFP | Getty Images

The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.

The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.

“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.

The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.

“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.

‘Too big to fail’

UBS has been battling the specter of tighter capital rules since acquiring the country’s second-largest bank at a cut-price following years of strategic errors, mismanagement and scandals at Credit Suisse.

The shock demise of the banking giant also brought Swiss financial regulator FINMA under fire for its perceived scarce supervision of the bank and the ultimate timing of its intervention.

Swiss regulators argue that UBS must have stronger capital requirements to safeguard the national economy and financial system, given the bank’s balance topped $1.7 trillion in 2023, roughly double the projected Swiss economic output of last year. UBS insists it is not “too big to fail” and that the additional capital requirements — set to drain its cash liquidity — will impact the bank’s competitiveness.

At the heart of the standoff are pressing concerns over UBS’ ability to buffer any prospective losses at its foreign units, where it has, until now, had the duty to back 60% of capital with capital at the parent bank.

Higher capital requirements can whittle down a bank’s balance sheet and credit supply by bolstering a lender’s funding costs and choking off their willingness to lend — as well as waning their appetite for risk. For shareholders, of note will be the potential impact on discretionary funds available for distribution, including dividends, share buybacks and bonus payments.

“While winding down Credit Suisse’s legacy businesses should free up capital and reduce costs for UBS, much of these gains could be absorbed by stricter regulatory demands,” Johann Scholtz, senior equity analyst at Morningstar, said in a note preceding the FINMA announcement.

“Such measures may place UBS’s capital requirements well above those faced by rivals in the United States, putting pressure on returns and reducing prospects for narrowing its long-term valuation gap. Even its long-standing premium rating relative to the European banking sector has recently evaporated.”