Nvidia is expected to resume the sale of its AI chips in China soon. This development follows the company’s previous challenges due to U.S. restrictions that prevented it from selling GPU chips used as AI accelerators in the country. The U.S. has imposed these limitations in an effort to curb China’s access to advanced technology, citing concerns over military applications.
As a consequence, competitors like Huawei have capitalized on this gap, receiving more demand for their own AI products. In a recent statement, Nvidia, the highly valued public company, announced that it has applied to the U.S. government for permission to ship its H20 chips to China. The company is optimistic about obtaining the necessary licenses shortly.
The H20 chips are the most advanced models that Nvidia can sell in China due to existing regulations from both the Trump and Biden administrations, which restrict the sale of more powerful GPUs outside of China. Currently, Nvidia CEO Jensen Huang is in Beijing and is scheduled to speak at an event there. He expressed his belief that if the company remains unable to penetrate the Chinese market, it risks losing its status as a leader in the global AI landscape.
Reports indicate that Chinese firms are eager to place orders for Nvidia’s GPUs, which will need approval from the U.S. government. Notable companies such as ByteDance and Tencent are reportedly poised to submit these orders. In the fiscal year ended January 26, 2025, Nvidia generated $17 billion in revenue from China, making up 13% of its global sales.
The strong preference for Nvidia’s computing platform, CUDA, among Chinese technology companies underscores the importance of this market. CUDA enables developers to leverage parallel processing capabilities, which are crucial for handling extensive AI operations efficiently. The news of Nvidia’s potential return to China has driven its stock prices up by nearly 4%, bringing its market valuation to approximately $4.16 trillion.