March 28, 2024
Nvidia Plans Q2 2024 Launch for China-Focused AI Chip

Nvidia Plans Q2 2024 Launch for China-Focused AI Chip

The U.S. chipmaker Nvidia is set to commence mass production of its artificial intelligence (AI) chip, the H20, designed for China in the second quarter of 2024. The H20 chip is the most powerful among three chips developed by Nvidia to adhere to U.S. export rules announced in October.

Originally scheduled for a November 2023 launch, its release was delayed due to integration issues faced by server manufacturers. Initial production volume will be limited, primarily serving major customers. The chip aims to address U.S. export restrictions that prevent Nvidia from shipping advanced products to China.

Chinese reluctance to purchase the downgraded H20 has led to domestic alternatives being tested amid concerns about the potential tightening of U.S. restrictions. Baidu, a leading Chinese search engine, shifted to ordering AI chips from Huawei as an alternative to Nvidia. Nvidia is also developing two other chips, the L20 and L2, to comply with the new restrictions, though no sales have been announced.

In December, Nvidia introduced a modified version of an advanced gaming chip to meet the new export rules. The H20, L20, and L2 chips retain most of Nvidia’s latest AI features but with reduced computing power to align with the regulations.

Nvidia strategically relies on these chips to maintain its market share in China after U.S. export restrictions prevented the shipment of products like the A800 and H800 AI chips. Introduced as alternatives for Chinese customers in November 2022, the A800 and H800 faced export restrictions just a month later. Nvidia’s move to comply with regulations underscores the challenges posed by geopolitical dynamics in the semiconductor industry.

Nvidia is taking precautions to navigate complex trade regulations and preserve its foothold in the Chinese market, emphasizing compliance with U.S. restrictions while developing AI chips tailored to the region’s needs. The delayed production of the H20 chip reflects the intricacies and challenges faced by global technology companies operating within evolving geopolitical frameworks.

Photo by Stas Knop

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