Nvidia-backed Nscale downplayed ByteDance ties ahead of U.S. IPO, FT reports

Nscale, an AI cloud provider backed by Nvidia, did not prominently disclose that ByteDance accounted for nearly three-quarters of its sales last year in its main pitch to investors, the Financial Times reported on Wednesday.

The TikTok owner was one of the first major customers for Nscale’s cloud-computing business, renting access to advanced Nvidia AI chips in Norway, according to people familiar with the matter and SEC filings cited by the FT.

The relationship was only indicated in a document published Friday alongside Nscale’s main filing for a U.S. initial public offering. The document did not directly mention ByteDance by name, the FT said.

ByteDance used Nscale’s cloud facility in Norway to access Nvidia chips that it would otherwise have been unable to buy in China, using a loophole in U.S. trade restrictions, the FT report said. Chinese tech companies have invested billions in AI and often use foreign cloud computing providers to train their models.

The arrangement is legal but exposes Nscale to regulatory and reputational risks as the U.S. and China compete to dominate the growing technology sector, the FT reported.