A Reuters exclusive via US News & World Report, July 28:
BEIJING/SHANGHAI/NEW YORK (Reuters) -Nvidia placed orders for 300,000 H20 chipsets with contract manufacturer TSMC last week, two sources said, with one of them adding that strong Chinese demand had led the U.S. firm to change its mind about just relying on its existing stockpile.
The Trump administration this month allowed Nvidia to resume sales of H20 graphics processing units (GPUs) to China, reversing an effective ban imposed in April designed to keep advanced AI chips out of Chinese hands due to national security concerns.
Nvidia developed the H20 specifically for the Chinese market after U.S. export restrictions on its other AI chipsets were imposed in late 2023. The H20 does not have as much computing power as Nvidia's H100 or its new Blackwell series sold in markets outside China.
The new orders with Taiwan's TMSC would add to existing inventory of 600,000 to 700,000 H20 chips, according to the sources who were not authorised to speak to media and declined to be identified.
For comparison purposes, Nvidia sold around 1 million H20 chips in 2024, according to U.S. research firm SemiAnalysis.
Nvidia CEO Jensen Huang said during a trip to Beijing this month that the level of H20 orders it received would determine whether production would begin again, adding that any restart to the supply chain would take nine months.
The Information reported after Huang's trip that Nvidia had told customers it had limited H20 stocks available and it had no immediate plans to restart wafer production for the GPU.
Nvidia needs to obtain export licenses from the U.S. government to ship the H20 chips. It said in mid-July it had been assured by authorities that it would get them soon.
The U.S. Department of Commerce has yet to approve those licenses, one of the sources and a third source said.
Nvidia on Monday declined to comment on the new orders or the status of its license applications. TSMC declined to comment. The U.S. Commerce Department did not immediately respond to a request for comment....
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This move on Nvidia's part raises a few questions with one being top-of-mind:
Can we infer anything about the uptake of Huawei's very advanced Ascend AI 910D processor and the just announced (July 26) Huawei CloudMatrix 384 AI System.
This is the sort of stuff that Mr. Huang was referring to a few months ago:
Nvidia CEO On AI Competition: China is right behind us, We’re very, very close
And via NBC10, Boston:
Nvidia CEO Jensen Huang said Wednesday that China is "not behind" in artificial intelligence, and that Huawei is "one of the most formidable technology companies in the world."....
....Huawei, which is on a U.S. trade blacklist, is reportedly working on an AI chip of its own for Chinese customers.
"They're incredible in computing and network technology, all these essential capabilities to advance AI," Huang said. "They have made enormous progress in the last several years."....
Which raises a second question. Is this story, here via UPI July 28, but also available on some of the tech sites, is this story already moot?
Security experts warn against selling Nvidia AI chips to China
In letter to Commerce secretary, they say H20 AI chips can be used to support China's military.
Twenty national security experts and former government officials are urging the Trump administration to reverse a decision earlier this month to let Nvidia resume selling H20 AI chips in China.
They wrote a letter Monday to Commerce Secretary Howard Lutnick, saying that the decision announced two weeks ago was a "strategic misstep that endangers the United States' economic and military edge in artificial intelligence (AI) -- an area increasingly seen as divisive in the 21st-century global leadership."....
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As noted exiting from May 18's "U.S. Still Mulling Whether To Allow Nvidia To Sell One Million+ Most Powerful Chips To UAE":
On the one hand with that many chips floating around that part of the world there is no way to keep a bunch of them from ending up in China. On the other hand, Nvidia's development cycle is focused on releasing new, more powerful chips every 12 -14 months meaning the current smoking hot H100 chips will have been superseded by two cycles at the end of the contract period.
The first point, that chips will get to China is borne out by the recent news that $1 billion worth of chips had been smuggled into China in three months after the export ban on the more powerful Nvidia chips.
note: the smuggled chips were not the ones destined for the UAE.
