Nvidia is preparing to launch a scaled-down version of its H20 artificial intelligence chip for the Chinese market within the next two months, according to three sources experts. The move follows recent U.S. government restrictions that effectively barred the original H20 chip from export to China without a licence.
The American chipmaker has informed major Chinese clients, including top-tier cloud computing firms, of its intention to introduce the reworked H20 chip by July, two of the sources confirmed.
This development marks Nvidia’s latest effort to retain its foothold in China, a market that generated $17 billion in revenue—13% of its total sales—in the fiscal year ending January 26. The firm is now navigating increasingly stringent U.S. export controls aimed at limiting China’s access to cutting-edge semiconductor technologies.
The H20 had previously been Nvidia’s most advanced AI chip permitted for sale in China. However, U.S. officials recently informed the company that the chip would now fall under the category of items requiring an export licence. In response, Nvidia has developed revised technical specifications for the chip, which include notably reduced memory capacity, as one source revealed.
Another source suggested that the performance of the new version could still be adjusted by downstream users via changes to the chip’s module configuration.
Nvidia has declined to comment on the matter, while the U.S. Commerce Department has yet to respond to enquiries.
The strategic importance of the Chinese market was underscored by Nvidia CEO Jensen Huang’s recent visit to Beijing, which came shortly after Washington unveiled the new licensing requirements. During his trip, Huang held meetings with Chinese officials and reaffirmed the country’s value to Nvidia, saying, “China is a very important market for us.”
Since 2022, the United States has imposed escalating restrictions on the export of Nvidia’s most advanced chips to China, citing national security concerns linked to their potential military applications.