(Bloomberg) -- China’s domestic AI chipmakers are making fast progress in closing the gap on international leaders, according to SenseTime Group Inc. co-founder Xu Bing.

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Asia has a shortage of computation power for artificial intelligence, lagging significantly behind the US, but China has the talent and data to make up lost ground, Xu said in an interview at the UBS Asian Investment Conference in Hong Kong. SenseTime is one of China’s artificial intelligence pioneers, though it’s been placed on a US investment blacklist as part of sweeping American sanctions curbing the country’s advances in AI.

China’s progress in this field has been made more difficult by US trade controls preventing the import of Nvidia Corp.’s advanced AI accelerators. That’s sparked the need for domestic alternatives from the likes of Huawei Technologies Co. and Shanghai Biren Technology Co., which are both also subject to US trade restrictions.

“There’s a shortage of resources here in Asia in general,” Xu told Bloomberg’s David Ingles. “It’s like a 10 times gap of the compute resources that we have here compared to the US leaders. But I think Asian markets never lack talent and never lack data.”

SenseTime aims to turn profitable within the next two years, Xu said. It’s raised $6 billion over the past decade and invested a third of that into research and development, including more than $1 billion on AI accelerator infrastructure. Its shares fell as much as 3.7% in Hong Kong on Tuesday, extending a week of decline.

What Bloomberg Intelligence Says

SenseTime Co-founder Xu Bing’s assertion that the company can break into profit in the next 1-2 years on Bloomberg TV is too optimistic. We remain pessimistic about the narrowly-focused, sub-scale firm’s chance of entering sustained profitability. With just 4.6 billion yuan net cash on its balance sheet at the end of 2023, we think SenseTime will need to raise new capital during the next 12 months. SenseTime lacks a discernible competitive edge, burning though 4.7 billion yuan cash in 2023.

— Robert Lea and Jasmine Lyu, BI analysts

Xu added that domestic chips in China are catching up quickly and SenseTime is working with local semiconductor companies to expand the compute capabilities that they have. He did not name specific firms, but Huawei has quietly become China’s chip technology development champion, having successfully worked around US curbs to develop its own advanced smartphone processor last year.