In a notable policy turnaround, tech giant Nvidia Corp. has disclosed plans to restart its H20 artificial intelligence (AI) chip exports to China. This decision follows the US government’s assurance that these exports will be sanctioned. The move could potentially recover billions in lost revenue for Nvidia, which was hit hard by stringent export controls imposed earlier.
## Nvidia Announces Resumption of H20 AI Chip Sales to China
Nvidia’s CEO, Jensen Huang, announced that the company had secured the Trump administration’s approval to continue exporting its H20 AI chips to China. This information was made public in a company blog post, and Huang also discussed the development on China’s state-run CGTN television network.
The blog post expressed Nvidia’s hopes of commencing deliveries shortly, following the US government’s assurance that the necessary licenses would be granted. The H20 chip, a model compliant with previous trade regulations and specifically designed for the Chinese market, had been banned from Chinese markets in April due to tightened export controls.
## US Government’s Stand on Chip Exports
The US government’s approval of export licenses for the H20 chip is a significant development, although the US Commerce Department, responsible for supervising semiconductor exports, has not yet commented on this matter.
## Impact on The Stock Market and the AI Chip Industry
Nvidia’s stock experienced a 4.47% surge in pre-market trading following the clearance to resume H20 AI chip exports to China. The approval could help Nvidia recover a substantial amount of lost revenue, given the $4.5 billion blow it suffered when the restrictions were implemented in April. AMD stock also saw a 3.18% rise in pre-market trading, indicating a renewed investor confidence in the AI chip market.
## Nvidia’s Strategy in China
Nvidia’s China strategy is further bolstered by its new RTX Pro chip, which is designed to comply with US export rules. This development could be a game-changer for Chinese giants like ByteDance and others who rely on advanced AI technology.
The H20 chip is a scaled-down version of Nvidia’s leading AI chips, specifically tailored for the Chinese market to comply with US trade restrictions first introduced in 2022. These rules were incrementally tightened, affecting successive chip generations — initially the H800, and then the H20.
## Conclusion
Nvidia’s resumption of H20 AI chip exports to China marks a significant shift in US policy and could potentially herald a new era in the AI chip market. This change could not only recover lost revenues for the company but also boost investor confidence in the sector. As we watch for the US Commerce Department’s stance on this matter, it will also be interesting to see how this influences the strategies of other players in the industry.
Originally published on https://www.angelone.in/news/nvidia-set-to-resume-h20-ai-chip-sales-to-china-amid-u-s-policy-shifts
