Nvidia CEO Jensen Huang confirmed on Friday that the company is in discussions with the U.S. government about potentially shipping a new, more advanced AI chip to China.
The chip, referred to as the B30A, would reportedly be more powerful than the H20, which is currently the only semiconductor Nvidia is authorized to sell in China. U.S. regulators have long expressed concern that advanced American chips could be used in Chinese military programs.
When asked about the B30A during a trip to Taiwan, Huang said:
“Offering a new product to China for the data center, AI data centers, the follow on to H20, that’s not our decision to make. It’s up to of course the United States government. And we are in dialogue with them. But it’s too soon to know.”
Nvidia’s China Struggles
Nvidia has had a complicated presence in China. Earlier this year, the company introduced the H20, a less advanced chip created to comply with export restrictions, only to see it further restricted by U.S. regulators. In July, Nvidia regained approval to sell the H20 in China, but under the condition that 15% of its China chip sales go to the U.S. government in exchange for licenses.
Now, the company faces fresh hurdles. Chinese regulators have raised security concerns about Nvidia’s products, while reports suggest Beijing has urged local companies to avoid using Nvidia chips. Nvidia has denied claims that its products contain “kill switches and backdoors.”
U.S. Response and Tensions With Beijing
The U.S. Commerce Department allowed the H20’s return to the Chinese market but emphasized that China would not receive Nvidia’s most advanced technology. “We don’t sell them our best stuff, not our second best stuff, not even our third best,” Commerce Secretary Howard Lutnick said in July.
According to the Financial Times, Chinese officials found the remark insulting, leading regulators to discourage domestic firms from purchasing the H20. Meanwhile, reports from The Information suggest Nvidia has already told some suppliers to halt production linked to the chip.
Nvidia’s shares dipped 1.34% in premarket trading on Friday, reflecting investor concern about the company’s uncertain future in China.
Author’s Opinion
Nvidia’s negotiations highlight the impossible balance it faces: keeping U.S. regulators satisfied while retaining access to one of its largest markets. Washington wants strict control, Beijing feels slighted, and Nvidia is caught in between. If China turns fully toward domestic alternatives like Huawei’s chips, Nvidia risks losing long-term relevance in the world’s second-largest economy. While short-term compromises like the H20 and potentially the B30A may buy time, Nvidia’s position in China is more fragile than it has ever been.
Featured image credit: Andrey Matveev via Unsplash
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