NVIDIA launches a downgraded version of the H20 chip to compete in the Chinese domestic market.

NVIDIA plans to launch a downgraded version of its H20 AI chip in the Chinese market within the next two months to comply with the latest U.S. export control measures. Sources indicate that NVIDIA has notified several major Chinese customers, including key cloud service providers, about the release of this adjusted chip. According to the export control framework of the Biden administration, the H20 chip is currently the highest performance product NVIDIA is approved to sell in China.

This measure is related to recent signals from the Trump administration, suggesting a possible tightening of restrictions on technology exports to China. Against this backdrop, NVIDIA is striving to comply with the new regulations and help businesses navigate these limitations by reducing the chip's computational performance and memory capacity through technical adjustments. Analysts believe that the Trump administration has continued the Biden administration's policy stance on China’s access to advanced AI technology.

The H20 chip is a core component in China’s AI industry, used extensively across various sectors from AI startups like DeepSeek to major internet companies such as Baidu and Alibaba. With the rise of Chinese domestic chip manufacturers, industry experts predict that NVIDIA's downgraded product may weaken its competitiveness in the Chinese market, especially as local companies like Huawei have already developed AI chip solutions that meet market demands.

According to financial report data, the Chinese market contributed approximately $17 billion to NVIDIA's revenues in the fiscal year ending January 2025, accounting for 13% of its total sales. NVIDIA CEO Jensen Huang made a special trip to Beijing in April, demonstrating the strategic importance of the Chinese market to the company.

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