Nvidia has reportedly discovered a way to sell high-end chips to Chinese companies while still complying with U.S. regulations aimed at restricting China’s access to technology. According to Chinese financial media Cailian Press, Nvidia is set to deliver three new chips, HGX H20, L20 PCle, and L2 PCle, to domestic manufacturers.
This move comes after U.S. restrictions last year that were aimed at curbing sales to China, which affected Nvidia’s H100 and A100 artificial intelligence chips. Despite the restrictions, the U.S. government still allowed Nvidia to develop the H100 in China.
Chinese companies had initially turned to Nvidia’s H800 and A800 chips, but the U.S. recently imposed new restrictions on these sales as well. This has left Chinese manufacturers with limited options. Bo Du, managing director at WestSummit Capital Management, stated that Chinese manufacturers have no better alternative in the near term and will continue to buy Nvidia’s chips while seeking replacements.
The H20 chip’s computing power is only about 50% of that of the A100. This has led companies in China to rush to develop local versions of OpenAI’s ChatGPT, driving up the demand for artificial intelligence computing power.
Nvidia’s new chips reportedly have operating metrics that circumvent the threshold of the U.S. restrictions. According to research firm SemiAnalysis, Nvidia is strategically navigating the new US regulations. The U.S. has emphasized that its focus is on limiting China’s advancement in advanced tech for military use, and domestic players are exploring ways to bypass U.S. restrictions.
The Financial Times also reported the news of Nvidia’s new chips for the China market, citing a document distributed to potential customers. While Nvidia declined to comment, the U.S. Department of Commerce and the Bureau of Industry and Security did not immediately respond to a request for comment.
As companies in China continue to face U.S. restrictions on technology sales, they are exploring alternatives and workarounds to ensure continuity of operations. This includes developing locally-made AI chips and exploring other forms of procurement to support their technological needs.
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