As the United States deliberates on enhanced trade restrictions aimed at preventing advanced chip technology from reaching China, Nvidia, a prominent U.S.-based semiconductor manufacturer, is reportedly developing a version of its latest artificial intelligence chips to adhere to these regulations.
Nvidia is said to be collaborating with a local distribution partner, Inspur, to introduce and market the new chip, temporarily named the “B20,” in China. According to sources familiar with the situation, the B20 is projected to start shipping by the second quarter of 2025. Nvidia has opted not to comment on these developments.
The company has already produced three chips designed to align with U.S. export controls, one being the H20, which Nvidia reduced prices for in response to weak sales as it competes against chips from its domestic rival Huawei. However, sales of the H20 are reportedly on the rise. Nvidia is anticipated to sell over one million H20 chips in China this year, valued at about $12 billion, despite the ongoing trade restrictions, according to data from SemiAnalysis cited by the Financial Times. This figure is nearly double the sales expectations for Huawei’s Ascend 910B chip.
Nevertheless, analysts at Jefferies have indicated that Nvidia’s H20 chips may face heightened scrutiny under potential new U.S. trade regulations. The upcoming annual review of U.S. semiconductor export controls, scheduled for October, is likely to result in a ban of the H20 chip for sale to China, according to the analysts. Possible avenues for implementing this ban could include a specific product ban, a reduction in the computing power threshold, or imposing limits on memory capacity.
Additionally, there is a possibility that the U.S. could extend export controls on chips sold to other countries in the region, such as Malaysia, Indonesia, and Thailand, or apply these controls to overseas Chinese firms, although this latter option would prove more challenging to enforce, analysts noted.