Vector quantization (VQ), in particular lattice-based methods, offer strong rate-distortion trade-offs for low-bit large language models (LLMs), yet their behavior under quantization-aware training (VQ-QAT) remains poorly understood. We scale lattice VQ-QAT to billion-parameter LLMs and multi-billion-token training regimes, and introduce SQuAT, a shape-gain VQ-QAT approach trained with a separate straight-through estimator (STE) for the shape and gain.

SQuAT decomposes weights into direction and magnitude: normalized directions are quantized using an $E_8$-derived spherical codebook, while gains are quantized independently with low-bit scalar quantizers. We show that, unlike a standard STE applied to the full quantizer, which ignores the shape-gain structure, these separate STEs induce tangent-space updates for directions, yielding an implicit form of spherical (Riemannian) optimization.

To enable scalability, we develop a distributed exact nearest-neighbor assignment scheme, in which workers quantize disjoint weight blocks and communicate only discrete indices, reducing VQ-QAT training time by 12.8$\times$ and allowing us to scale it to 10B tokens. Across instruction-tuned LLaMA-3.2-1B/3B, Qwen3-4B, and base Qwen3-1.7B, SQuAT consistently outperforms standard VQ-QAT STE under identical quantizers and initialization, and achieves SOTA VQ-QAT accuracy.