As the U.S. government deliberates on imposing stricter trade restrictions aimed at preventing advanced chip technology from being exported to China, Nvidia, a leading U.S.-based chip manufacturer, is reportedly developing a new version of its artificial intelligence chips that aligns with these regulations.
According to reports from unnamed sources, Nvidia is collaborating with Chinese distributor Inspur to create and market a chip, tentatively named the “B20,” specifically for the Chinese market. The B20 is slated for shipping in the second quarter of 2025, marking Nvidia’s strategic maneuver to adapt to the evolving trade landscape.
Despite facing challenges from trade restrictions, Nvidia has also produced several chips that comply with U.S. export controls, including the H20 chip. After lowering prices to remain competitive against domestic rival Huawei, H20 sales have reportedly started to gain traction. Nvidia is projected to sell over one million H20 chips in China this year, with a market value estimated at around $12 billion, significantly surpassing the anticipated sales of Huawei’s Ascend 910B chip.
However, analysts from Jefferies have warned that further U.S. trade regulations could jeopardize the future of H20 sales. As the U.S. prepares for its annual review of semiconductor export controls in October, there is a strong possibility that the H20 chip could face a ban on sales to China. Potential measures could include a specific product ban or adjustments to computing power and memory capacity limits for the current chips.
In the broader context, there are concerns that the U.S. might extend these restrictions to other countries in the region, such as Malaysia, Indonesia, and Thailand, or even to Chinese companies operating abroad, although this may present additional challenges.
While the regulatory landscape remains uncertain, Nvidia’s proactive approach in developing compliant chip variants demonstrates the resilience and adaptability of U.S. technology firms amidst international trade challenges. This situation underscores the dynamic nature of the tech industry and the potential for innovation even in the face of adversity.
Summary: Nvidia is reportedly creating a new version of its AI chip for China while navigating U.S. trade restrictions. The H20 chip, despite worries of impending bans, has seen sales growth, highlighting Nvidia’s adaptability in a restrictive environment.