China’s artificial intelligence (AI) chip industry maintained rapid growth in 2018, with total sales volume increasing 50.2% year-on-year to more than 8 billion yuan ($1.12 billion), according to a report released Friday.

The report by CCID Consulting, a direct affiliate of the government-run China Center for Information Industry Development, attributed the expansion to a combination of factors including favorable policies, technological advancement and widespread AI applications, among others.

Cloud-training chips accounted for 51.3% of the AI chip market in China in 2018, and the industry is expected to increasingly focus on integrating cloud technology with edge computing, according to the report, which was released during the World Artificial Intelligence Conference in Shanghai. The AI chip market will sustain a compound annual growth rate of more than 50% in the next three years, the report estimates.

Related: Shanghai to Sign Dozens of AI, 5G Partnerships at World Artificial Intelligence Conference

Contact reporter Isabelle Li (liyi@caixin.com)