As the United States deliberates on stricter trade regulations aimed at preventing advanced chip technology from being exported to China, Nvidia, a prominent U.S.-based chip manufacturer, is reportedly developing a new version of its artificial intelligence chips to adhere to these impending rules.
According to sources familiar with the situation, Nvidia plans to collaborate with a local distribution partner, Inspur, to introduce and sell a version of its Blackwell AI chips, tentatively named the “B20,” in China. The new chip is expected to begin shipping in the second quarter of 2025.
Nvidia has been actively creating chips that meet U.S. export controls, including the H20 chip, which the company has reduced prices for amid a competitive landscape dominated by domestic rival Huawei. Despite initial slow sales, H20 chip sales have reportedly begun to pick up. Analysts predict that Nvidia may sell over one million H20 chips in China this year, generating approximately $12 billion in revenue, despite existing U.S. trade restrictions. This figure is nearly double Huawei’s projected sales for its Ascend 910B chip.
However, analysts from Jefferies have raised concerns that Nvidia’s H20 chips could face further restrictions under upcoming U.S. trade regulations. In the annual review of semiconductor export controls scheduled for October, there’s a strong possibility that the H20 will be prohibited from being sold to China. Potential forms of this ban could include a specific prohibition on the product, a reduction in the allowable computing power, and/or capping memory capacity.
Moreover, the U.S. government may consider extending export controls to semiconductor sales in other countries such as Malaysia, Indonesia, and Thailand, or to overseas Chinese companies, although implementing these measures might be more challenging.