Why Nvidia's AI chip plans for China may not go as planned
may have been hit with a 'new' problem with resuming export of its AI chips to China. The US-based company, which was recently given a go-ahead to restart the sales of
H20 AI chips
to the region, has reportedly informed its Chinese customers of limited supplies for the chips. H20 is the most powerful AI processor the semiconductor company has been permitted to sell to the country under US export restrictions.
According to a report by The Information, the supply constraints stem from an April US government ban on H20 chip sales. Citing two sources, the report claims that this ban compelled Nvidia to void existing customer orders and cancel manufacturing capacity previously booked with chipmaker Taiwan Semiconductor Manufacturing (TSMC).
Nvidia CEO
Jensen Huang
stated at a Beijing media event last week that TSMC had subsequently reallocated its H20 production lines to produce other chips for different clients.
Resuming manufacturing of Nvidia H20 chips may take time
The report said that manufacturing new H20 chips from scratch could now take up to nine months. Moreover, Nvidia reportedly does not plan to restart H20 production, though the report did not cite specific sources for this detail.
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by Taboola
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Despite these reported supply issues, Huang recently commented that Nvidia would ramp up H20 chip supply and that licenses for Chinese orders would be swiftly approved.
This comes just days after Nvidia announced its intent to resume H20 sales to the region, pending US government export license approvals. Huang also met with US President Donald Trump in the Oval Office last week to advocate for restarting sales of his company's specialised AI chips to China.
Citing two individuals familiar with the meeting, The New York Times reported that Huang argued that American-made chips should remain the global standard. He is also said to have contended that the US would be making an error by ceding the massive Chinese market to homegrown competitors.
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