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Nvidia to launch new AI chips for China amid US export restrictions

EditorAmbhini Aishwarya
Published 11/10/2023, 05:57 AM
Updated 11/10/2023, 05:57 AM
© Reuters

Nvidia Corporation (NASDAQ:NVDA) is set to unveil a series of new artificial intelligence (AI) chips for the Chinese market, maneuvering within the latest U.S. export controls. The graphics chipmaker plans to introduce the HGX H20, L20 PCIe, and L2 PCIe chips, which comply with the recent U.S. regulations by featuring reduced computing power.

The news comes in the wake of October's announcement regarding Washington's export restrictions that barred Nvidia from selling two advanced AI chips, specifically designed for China under previous rules. These restrictions are part of broader efforts to prevent Beijing from using American technology in military applications.

Despite these constraints, Nvidia is pushing forward with its commitment to the Chinese market, aiming to roll out the new chips around November 16. The upcoming launch has already positively impacted Nvidia's stock, with shares increasing by 3.3% during midday trading on Thursday.

Wells Fargo analysts are closely monitoring the situation, noting that while all three forthcoming chips appear to meet the absolute caps on computing power set by the U.S., there's a possibility that one may still require a license.

Nvidia's persistence in serving its largest customer base underscores the company's strategic importance in the AI landscape and its role in powering advancements in machine learning and data processing. The chipmaker's efforts reflect an ongoing commitment to maintaining a presence in China's significant AI chip market, estimated at $7 billion, even as it navigates through the complexities of international trade regulations.

The potential impact of U.S. restrictions on Nvidia's product development was acknowledged in an SEC filing, highlighting the delicate balance between innovation and compliance with national security concerns. The unfolding scenario will be pivotal for both Nvidia and the global tech industry as it illustrates how companies are adapting to geopolitical pressures without stifling technological progress and market aspirations.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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