ByteDance is developing its own custom CPU to support its expanding artificial intelligence infrastructure, according to sources. The move comes as the company faces soaring chip prices and supply shortages, which are hindering its growth plans. ByteDance aims to deploy these in-house CPUs in its servers and data centers, facilitating the rollout of agent-based products like the Coze platform. The company is exploring two CPU architecture pathways: one based on Arm architecture and another on the open-source RISC-V instruction set. This strategic development is in response to significant price hikes from current suppliers Intel and AMD, with increases ranging from 10% to 35% in recent months. ByteDance's initiative underscores the industry's shift towards the "inference" phase, driving up CPU demand and contributing to recent shortages.