Nvidia (NASDAQ: NVDA) is on track to sell AI chips in China worth $12 billion this year. Despite strict U.S. export restrictions aimed at limiting Chinaโs access to advanced technology, Nvidia will deliver over 1 million units of its new H20 chips to the Chinese market. Each H20 chip is priced between $12,000 and $13,000.
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The projected revenue is a remarkable increase from Nvidiaโs previous fiscal year in China, where the company earned $10.3 billion. The new H20 chips meet regulatory requirements and also attract high demand from Chinese customers.
Nvidia sells H20 AI chips amid export restrictions
The H20 chips are built specifically to comply with U.S. regulations while still delivering high performance. According to SemiAnalysis, Nvidia is set to deliver more than 1 million H20 chips to Chinese customers in the coming months. This number is almost double what Huawei is expected to sell of its rival chip, the Ascend 910B.
The efforts by Bidenโs administration to end Chinaโs access to advanced AI technology have increased competition within the Chinese market. However, the H20 chip has become a popular alternative, helping the company maintain a strong presence in China.ย
The Chinese market for AI chips is highly competitive, especially with U.S. export control measures in place. In 2022, the U.S. blocked the export of advanced Nvidia chips to China and tightened restrictions further last year. Despite these challenges, H20 chips have gained remarkable purchases.
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Nvidiaโs maneuvering through these restrictions has allowed the company to maintain its market presence and capitalize on it. The SemiAnalysis report shows that the sales projections for the H20 chip surpass those of Huaweiโs Ascend 910B, highlighting the companyโs competitive upper hand. With each H20 chip priced between $12,000 and $13,000, Nvidia stands to generate over $12 billion in sales this year.
Cryptopolitan reporting by Chris Murithi
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