As the U.S. government contemplates stricter trade regulations aimed at curbing the export of advanced chip technology to China, Nvidia, a leading U.S.-based chip manufacturer, is reportedly developing a modified version of its groundbreaking artificial intelligence chips to adhere to these new requirements.
According to sources familiar with the matter, Nvidia is collaborating with a Chinese distribution partner, Inspur, to introduce its innovative chip, temporarily named the “B20,” in the Chinese market. This new version of Nvidia’s Blackwell AI chips is anticipated to begin shipping in the second quarter of 2025.
Currently, Nvidia offers three chip models that comply with U.S. export regulations, including the H20, which the company has price-optimized in response to lackluster sales and competition from domestic rival Huawei. Significantly, however, H20 sales are reportedly picking up momentum, with projections that Nvidia will sell over one million units in China this year, translating to approximately $12 billion in revenue, according to SemiAnalysis data. This figure nearly doubles Huawei’s sales expectations for its Ascend 910B chip.
Nevertheless, the H20 chips might face challenges under any forthcoming U.S. export regulations, as identified by analysts from Jefferies. In light of the U.S. annual review of semiconductor export controls this October, there is a strong likelihood that the H20 could be prohibited for sale in China. Possible paths for such a ban could include a specific prohibition on the product, adjustments to the computing power limits, or restrictions on memory capacities.
Additionally, there may be an expansion of export controls affecting chips sold to nearby countries like Malaysia, Indonesia, and Thailand, or even extending regulations to overseas Chinese companies—a move that analysts believe would prove difficult to execute.
This situation illustrates the complexities and challenges within the semiconductor industry, particularly as both U.S. and Chinese markets navigate robust competition and evolving trade policies. While Nvidia confronts these hurdles, the company’s proactive measures in developing compliant products highlight its commitment to sustaining operations and growth in challenging circumstances. As the industry continues to adapt, it remains crucial for companies to innovate while adhering to regulatory frameworks, ensuring that technological advancements can be delivered globally.