Nvidia’s New AI Chips: Can They Overcome U.S. Trade Hurdles?

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As the U.S. explores stricter trade measures to prevent advanced chip equipment from reaching China, Nvidia, a U.S.-based semiconductor manufacturer, is reportedly developing a modified version of its new artificial intelligence chips to meet those regulations.

According to a report from Reuters, Nvidia is collaborating with a local partner, Inspur, to introduce and market a new chip, referred to as the “B20,” in China. The B20 is projected to begin shipping in the second quarter of 2025.

Nvidia has created three chips designed to adhere to U.S. export controls, including the H20, which the company has lowered prices for in response to declining sales, facing competition from the Chinese firm Huawei. Nevertheless, H20 sales are reportedly on the rise, and Nvidia is anticipated to sell over one million H20 chips in China this year, generating approximately $12 billion in revenue, even amid existing U.S. trade restrictions. This expected sales figure is nearly double Huawei’s projections for its Ascend 910B chip.

However, analysts at Jefferies have indicated that Nvidia’s H20 chips could be in jeopardy under potential new U.S. trade regulations. As the annual review of U.S. semiconductor export controls approaches this October, there is a strong likelihood that the H20 may face a sales ban in China. Analysts suggested that this could occur through a specific product ban, a reduction in permissible computing power, or restrictions on memory capacity.

Furthermore, there is potential for the U.S. to widen its export controls on chips sold to other countries in the region, such as Malaysia, Indonesia, and Thailand, or to include overseas Chinese companies, although the latter would be more challenging to enforce.

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