The H20 was launched in 2024 due to tighter US export regulations that restricted sales of Nvidia’s older, more advanced AI processors.
Nvidia announced that it would offer computer chips made in China to consumers in the country, in the middle of a growing and intensifying trade war with the world’s largest economy, the United States. The founder and chief executive officer (CEO), Jensen Huang, announced it when he visited Beijing for the third time this year.
The United States was putting export restrictions on Nvidia to prevent the Chinese from getting their hands on the most advanced semiconductors due to national security concerns. According to US-listed companies, the restrictions would cut their revenue by $15 billion.
The company released a recent annual report, which states that Nvidia made $17 billion in revenue from China in the fiscal year that ended on January 26. It is 13% of the company’s sales. Huang has continuously cited China as a critical market for the company’s growth.
California-based chipmaker stated that Nvidia will start delivering the chip as soon as the US government promises to grant licenses for exporting the H20 chip, a made-for-China product less powerful than Nvidia’s gold standard acceleration chip.
The chipmaker company stated that Nvidia also plans to launch a brand-new, fully compliant RTX PRO graphics processing unit (GPU) for China that is perfect for digital twin artificial intelligence (AI) in smart factories and logistics.
According to Bank of America forecasts, Nvidia benefited from sales resuming as it was able to reach one of the biggest investors in AI, where financing could grow 48% this year to US$98 billion. Nvidia is the first US$4 trillion company to do so in history. It is a milestone for China’s developers of large language models (LLM) and other AI applications as they get their hands on some of the most advanced chips for high-powered computing.
Hung was to attend the International Supply Chain Expo in Beijing, where he wanted to meet the government and industry representatives to discuss how artificial intelligence can increase efficiency and expand more opportunities. The expo, a significant gathering hosted by the Chinese government, was previously attended by some US executives, including Tim Cook, CEO of Apple.
According to the China Council for the Promotion of International Trade (CCPIT), the expo’s organiser, Huang, will be speaking in Mandarin at the expo.
The 62-year-old Taiwanese American CEO stated that he is very delighted to start shipping H20 very soon in Chinese markets.
The H20 was developed and launched in 2024 due to tighter US export regulations that restricted sales of Nvidia’s older, more advanced AI processors, including the A100, H100, A800, and H800.
Chinese tech companies like ByteDance ( owner of TikTok) and Alibaba Group Holding have all used the chip, which costs between $12,000 and $15,000 per card, to develop their AI.
According to data from research firm Omdia, Tencent and ByteDance bought over 230,000 of Nvidia’s Hopper-series processors last year, second to Microsoft’s 485,000-chip bulk order.
Huang described Nvidia’s announcement that Washington will start to acquire a license to export H20 to China as “deeply painful.” The company estimated that this setup would cost them US$5.5 billion.
As China reduces its restrictions on rare earth exports and the US permits chipmaker software services to resume in China, this decision to resume sales of the H20 shows a reduction in tensions between Washington and Beijing.
One of the sources said that Nvidia has set up a “whitelist” that enables Chinese companies to sign up for potential purchases. It means it allows entities access to IP addresses, email addresses, applications, or users.
ByteDance and Tencent did not respond to a request for comment. Similarly, Nvidia did not respond to comments about the “whitelist”.