NVIDIA sidesteps U.S. export rules, makes new chip series for booming China market

NVIDIA sidesteps U.S.

• NVIDIA unveils HGX H20, L20 PCle, L2 PCle chips for China, compliant with new U.S. export rules, replacing A800 and H800.
• U.S. chip export restrictions may cost NVIDIA over $5 billion in Chinese orders, opening market opportunities for competitors like Huawei.
• Global GPU market projected to soar to $246.51 billion by 2028; NVIDIA leads in AI and high-performance computing amid increasing demand.

NVIDIA unveils new chip series for China market, compliant with U.S. export rules

A distributor for NVIDIA in China has stated that the company has developed an upgraded series of chips specifically for the Chinese market: the HGX H20, L20 PCle, and L2 PCle.

The distributor noted that these new chips, compliant with the latest U.S. export regulations, will be available to Chinese customers as replacements for the A800 and H800 models. NVIDIA may announce this development as soon as November 16, 2023.

Also read: AMD to acquire AI software startup to catchup with Nvidia

US imposes swift chip export restrictions, impacting Nvidia’s Chinese market

On October 17, the US Department of Commerce issued new chip export restrictions, preventing Nvidia from selling two improved advanced artificial intelligence chips – the A800 and H800 – to China, both of which were produced for the Chinese market last year, specifically to comply with US export regulations in October 2022.

On October 24, Nvidia said that the US regulator had advanced the implementation deadline of the new rules, effective immediately from 23 October. The new rules were due to take effect on 16 November. The Wall Street Journal reported on 31 October that because of the sudden implementation of new regulations in the United States, Nvidia may lose more than $5 billion in Chinese orders.

According to Reuters, Nvidia has more than 90 percent of the Chinese AI chip market. Analysts say the restrictions introduced by Washington could create opportunities for Chinese companies like Huawei.

Nvidia leads rapid growth in GPU market

At present, the GPU chip market is showing a rapid growth trend. Major manufacturers include Nvidia, AMD, and Intel. Nvidia dominates the field of high-performance computing and artificial intelligence, and its powerful computing power and optimised deep learning algorithms make it a top choice. With the rise of gaming, virtual reality, and cryptocurrency mining, the demand for GPU chips is increasing and the market is becoming increasingly competitive.

At the same time, with the development of artificial intelligence, big data and other fields, the advantages of GPU chips in accelerating computing have gradually received attention.

Global GPU market forecast: explosive growth to $246.51 billion by 2028 with a CAGR of 32.82%

According to Verified Market Research (VMR) data, the global GPU market will be $25.41 billion in 2020. With growing demand, this figure is expected to reach $246.51 billion by 2028, representing a compound annual growth rate (CAGR) of 32.82%. VMR predicts that by 2025, the market size of GPGPU chip board cards in China will reach 45.8 billion yuan ($6.3 billion), more than five times the 8.6 billion yuan in 2019, with a CAGR of 32% from 2019 to 2025.