As the United States considers implementing stricter trade restrictions to prevent advanced chip technology from reaching China, U.S.-based chip manufacturer Nvidia is reportedly developing a modified version of its latest artificial intelligence chips to adhere to these regulations.
According to sources familiar with the situation, Nvidia is working on a variant of its new Blackwell AI chips specifically for the Chinese market, with plans to partner with local distributor Inspur for the launch and sale of the chip, tentatively named the “B20.” This chip is anticipated to begin shipping in the second quarter of 2025, although Nvidia has declined to comment on the reports.
Nvidia has three chips that comply with U.S. export controls, including the H20. The company recently reduced prices on the H20 due to sluggish sales in an attempt to compete with local rival Huawei. However, reports indicate that sales of the H20 are now increasing. It is projected that Nvidia will sell over one million H20 chips in China this year, valued at approximately $12 billion, despite ongoing U.S. trade restrictions. This sales figure is nearly double Huawei’s anticipated sales for its Ascend 910B chip.
Nonetheless, analysts from Jefferies have warned that Nvidia’s H20 chips could face additional risks from upcoming U.S. trade regulations. With the annual review of semiconductor export controls scheduled for October, analysts suggest it is likely that the H20 could be banned from sale to China. This potential ban could manifest through various means, such as a specific product ban, a reduction in the allowed computing power, or limitations on memory capacity.
Furthermore, the U.S. may consider extending export controls on chips sold to other countries in the region, like Malaysia, Indonesia, and Thailand, or could broaden these controls to include overseas Chinese companies, although the latter option would be more complex to implement, according to the analysts.