Chinese technology company ByteDance is in talks with Shanghai-based Iluvatar CoreX to purchase AI chips for inference work and is also considering a similar deal with Baidu, according to two sources familiar with the matter. If a deal is agreed, Iluvatar CoreX would become ByteDance's third major domestic supplier of graphics processing units (GPUs) after Huawei and Cambricon, the sources added. TikTok parent ByteDance is also considering using Baidu's Kunlunxin chips, they said, declining to be named as the talks are not public. Tencent is already a Kunlunxin chip customer, according to one of the sources. ByteDance, Iluvatar CoreX, Baidu and Tencent did not respond to requests for comment. The potential deals demonstrate that efforts by Chinese chipmakers to offer alternatives to foreign AI chips are gaining traction as Beijing promotes the use of locally developed chips to improve self-reliance amid U.S. export controls on advanced chips. Chinese GPU and AI chipmakers captured nearly 41% of China's AI accelerator server market last year, eroding Nvidia's once-dominant position in one of its most important overseas markets, Reuters reported in April.