TikTok owner ByteDance is ramping up its spending on artificial intelligence infrastructure, boosting its planned capital expenditure this year to more than 200 billion yuan (US$30 billion), according to two people familiar with the matter.

This represented an increase of at least 25 per cent compared with a preliminary plan discussed late last year that proposed AI capex of 160 billion yuan, they said.

The increase was necessary because of the company’s growing commitment to AI, as well as rising memory chip costs, one of the people said.

Notably, ByteDance has allocated a proportionally larger budget to domestic AI chips, now a common practice among Chinese tech companies to mitigate geopolitical risks and to heed Beijing’s call to use more domestic semiconductors.