Nvidia's notable move in China.

Nvidia's booth at a technology exhibition. Photo: Bloomberg .

According to Nikkei , Nvidia plans to ship a specially modified version of its AI chip to customers in China in the coming months. This is the latest move to maintain the company's presence in China.

Nvidia's new chip is expected to be a modified version of the Hopper series, removing high-performance memory (HBM) – a crucial component for optimizing demanding computing tasks. Instead, the chip will use GDDR7 memory, complying with US export restrictions for China.

Nvidia is also developing a Blackwell chip specifically designed for China, expected to launch later this year. Rumors suggest the chip will also use GDDR7 memory instead of HBM.

"Although H2O products cannot be redeveloped and reused as rumored, we are still evaluating the limited options available for the Chinese market," an Nvidia spokesperson said.

According to Nikkei , this information was shared by an Nvidia representative after rumors circulated that the company was "no longer shipping" the new Hopper chip. Speaking to reporters in Taipei on May 17th, CEO Jensen Huang emphasized that the Hopper chip "cannot be further modified."

In 2024, Nvidia launched the H20 chip for China after the administration of former US President Joe Biden tightened restrictions on AI chip exports. By April 9th, the US government required the company to obtain an export license for the H20 based on the new regulations.

According to estimates, Nvidia will record $5.5 billion in operating expenses in the first fiscal quarter of 2025 due to the new regulations. According to internal filings, the company stated that any “integrated circuits and circuit boards with memory bandwidth, connectivity bandwidth, or a combination of both equivalent to H2O” will be subject to US regulations and require an export license.

Despite having to modify and remove HBM memory, analysts believe Nvidia's chips for China remain competitive.

Recently, major internet companies such as ByteDance, Alibaba, and Tencent have stockpiled billions of dollars worth of H2O chips ahead of the new US ban taking effect in April.

Amidst US restrictions on AI chip exports, domestically developed chips by Huawei are becoming increasingly popular. Leading Chinese AI companies such as iFlytek and SenseTime are among the clients using Huawei's Ascend platform.

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CEO Jensen Huang introduces the new line of chips. Photo: Bloomberg .

Nvidia CEO Jensen Huang once emphasized that Huawei is "one of the most formidable companies in the world ," with the ability to enter markets where American companies are not present.

On May 13, the US government launched a new attack on Huawei, warning that using Huawei's AI chips anywhere, by anyone, risks violating regulations.

Meanwhile, the Financial Times reported that Nvidia is looking to build a research and development center in Shanghai. The goal is to assess the specific needs of Chinese customers, research technical factors to meet US regulations, and help Nvidia maintain its competitiveness in the country of over a billion people.

"Huawei and other Chinese companies are protected from American competitors in the $50 billion market, and are leveraging that to compete with American companies globally," an Nvidia spokesperson emphasized.

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