As the U.S. considers implementing stricter trade restrictions to prevent advanced chip technology from reaching China, Nvidia, a leading chipmaker based in the U.S., is reportedly developing a version of its new artificial intelligence chips to align with these regulations.
According to sources familiar with the situation, Nvidia is focusing on a new chip, tentatively named the “B20,” designed for the Chinese market. The company plans to collaborate with a local distribution partner, Inspur, to launch and sell this chip in China. Production of the B20 is expected to begin in the second quarter of 2025. Nvidia has not publicly commented on the matter.
The chipmaker has already introduced three chips that comply with U.S. export controls, including the H20. To remain competitive amid sluggish sales, Nvidia has reduced prices for the H20, which had faced tougher competition from domestic rival Huawei. However, sources indicate that sales of the H20 have now seen an uptick, with Nvidia projected to sell over one million units of this chip in China this year, bringing in approximately $12 billion, despite existing trade restrictions. This sales forecast is nearly double that of Huawei’s expectations for its Ascend 910B chip, according to data from SemiAnalysis.
Nevertheless, there are concerns that Nvidia’s H20 chips may face additional risks if new U.S. trade regulations are enacted. Analysts at Jeffries suggest that during the U.S. annual review of semiconductor export controls in October, there is a strong possibility that the H20 could be prohibited for sale to China. Potential paths for such a ban could include a direct prohibition on the product, a reduction in its computing power limits, or a cap on memory capacity.
Furthermore, the U.S. may broaden export controls to other countries in the region, such as Malaysia, Indonesia, and Thailand, or extend restrictions to overseas Chinese companies, although implementing such measures could prove to be more challenging, according to the analysts.