Nvidia Sells AI Chips to China for $12 Billion

Nvidia Sells AI Chips to China for  Billion

According to the Financial Times, Nvidia, which recently became the world's most valuable company thanks to the AI ​​wave, is set to sell $12 billion worth of AI chips to China, despite US export restrictions.

The paper cites analysts’ expectations that the company will ship more than a million of the new H20 chips, which are designed to avoid US export restrictions imposed to limit sales of AI cards to Chinese customers. The H20 chips cost between $12,000 and $13,000, so the sale would mean revenue of about $12 billion. Last year, Nvidia sold chips, graphics cards and other products in China for $10.3 billion.

Selling 1 million AI chips is more than double the number that Chinese rival Huawei is expected to deliver with its Ascent 910B chip, according to the Financial Times.

Trying to stop sales to China

The United States has taken various measures to try to limit the sale of AI components to China. The concern should be that China could use the components to create powerful AI systems that could be used in a military context.

Nvidia has said on several occasions that the restrictions will result in significant revenue losses for the company. During its earnings presentation in May, CEO Jensen Huang commented that business in China was much lower than previous levels, and that competition was greater.

“However, we continue to do our best to serve customers in the Chinese markets,” he added.

Despite the fact that the AI ​​chips that evade the restrictions are somewhat weaker than the chips that Nvidia can sell in the US, the product is very popular with Chinese customers, according to the Financial Times.

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The newspaper notes that an analyst from SemiAnalogy believes that although the H20 has somewhat lower performance than the Huawei 910B, the H20 is better in practice due to better memory performance.

Most Chinese AI companies have also based their AI models on Nvidia’s ecosystem and software. Switching to Huawei’s infrastructure would be time-consuming and costly.

Hanisi Anenih

Hanisi Anenih

"Web specialist. Lifelong zombie maven. Coffee ninja. Hipster-friendly analyst."

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