Nvidia to Release AI Chips Tailored for Chinese Market Despite US Restrictions

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Nvidia is set to release new artificial intelligence (AI) chips specifically tailored for the Chinese market, despite recent US restrictions on selling high-end AI chips to China. The chip industry newsletter SemiAnalysis reported that Nvidia’s new chips, named HGX H20, L20 PCIe, and L2 PCIe, are likely to be announced on November 16 at the earliest. Following the news, Nvidia’s shares saw a 3.3% increase in midday trading.

While these chips incorporate many of Nvidia’s latest AI features, they have undergone some modifications to comply with the new US rules. The specifications of the chips analyzed by SemiAnalysis revealed reduced computing power measures to adhere to the restrictions. Nvidia declined to comment on the report, and both the White House and Commerce Department have not yet responded to requests for comment.

Last month, Nvidia announced that the new US export restrictions would prevent the sale of two of its advanced AI chips, the A800 and H800, both of which were originally developed for the Chinese market last year under previous export rules. The latest restrictions impose limits on the computing power that can be packed into smaller-sized chips. There is also a grey zone where chips may still be allowed to be shipped to China but would require a license.

According to Wells Fargo analyst Aaron Rakers, all three of Nvidia’s reported chips appear to comply with the absolute limits on computing power, but one chip falls into the grey zone and would require a license. Rakers expressed concern that Nvidia might be perceived as being too aggressive in circumventing US restrictions, potentially leading to further government action. Approximately one-quarter of Nvidia’s data center chip revenue is derived from China.

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Nvidia’s high-end gaming chip, the RTX 4090, is also affected by the new rules. The company stated that these restrictions would take immediate effect, as US regulators expedited the original deadline.

Nvidia currently dominates over 90% of China’s $7 billion AI chip market. Analysts predict that the US restrictions will open up opportunities for domestic companies like Huawei Technologies to make significant advancements. Reports suggest that Chinese internet giant Baidu has already placed a substantial order for Huawei AI chips in anticipation of future difficulties in purchasing from Nvidia.

Overall, despite the US restrictions, Nvidia remains committed to the Chinese market by introducing new AI chips tailored to its specific requirements. This move could pave the way for increased competition and innovation within the Chinese AI chip industry.

Frequently Asked Questions (FAQs) Related to the Above News

What is the news about Nvidia releasing new artificial intelligence chips for the Chinese market?

Nvidia is set to release new AI chips named HGX H20, L20 PCIe, and L2 PCIe, specifically tailored for the Chinese market. This comes despite recent US restrictions on selling high-end AI chips to China.

When are these new chips expected to be announced?

The chip industry newsletter SemiAnalysis reported that the announcement of these new chips is likely to happen on November 16 at the earliest.

How did the news of Nvidia's new chips affect their shares?

Following the news, Nvidia's shares saw a 3.3% increase in midday trading.

What modifications have been made to comply with the new US rules?

The specifications of the chips analyzed by SemiAnalysis revealed that the chips have undergone modifications to adhere to the US restrictions. The computing power measures have been reduced to comply with the rules.

Have the US government entities responded to the news?

Both the White House and Commerce Department have not yet responded to requests for comment on this matter.

What were the previous export restrictions on Nvidia's AI chips?

Last month, Nvidia announced that the new US export restrictions would prevent the sale of two of its advanced AI chips, the A800 and H800, both of which were originally developed for the Chinese market under previous export rules.

What are the limits imposed by the new restrictions?

The latest restrictions impose limits on the computing power that can be packed into smaller-sized chips. There is also a grey zone where chips may still be allowed to be shipped to China but would require a license.

Do all three of Nvidia's reported chips comply with the restrictions?

According to Wells Fargo analyst Aaron Rakers, all three of Nvidia's reported chips appear to comply with the absolute limits on computing power. However, one of the chips falls into the grey zone and would require a license.

What concerns have been raised about Nvidia's compliance with the restrictions?

Analyst Aaron Rakers expressed concern that Nvidia's perceived aggressiveness in circumventing US restrictions could potentially lead to further government action. Approximately one-quarter of Nvidia's data center chip revenue is derived from China.

How are Nvidia's high-end gaming chips affected by the new rules?

The new rules also affect Nvidia's high-end gaming chip, the RTX 4090. The company stated that these restrictions would take immediate effect, as US regulators expedited the original deadline.

How could these restrictions create opportunities for domestic Chinese companies?

Analysts predict that the US restrictions will open up opportunities for domestic companies like Huawei Technologies to make significant advancements in the AI chip market. Chinese giant Baidu has reportedly already placed a substantial order for Huawei AI chips due to anticipation of future difficulties in purchasing from Nvidia.

What does Nvidia's commitment to the Chinese market mean for the industry?

Despite the US restrictions, Nvidia remains committed to the Chinese market by introducing new AI chips tailored to its specific requirements. This move could pave the way for increased competition and innovation within the Chinese AI chip industry.

Please note that the FAQs provided on this page are based on the news article published. While we strive to provide accurate and up-to-date information, it is always recommended to consult relevant authorities or professionals before making any decisions or taking action based on the FAQs or the news article.

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