Thought Leadership
With stricter restrictions on the supply of AI chips to China, the US government is causing semiconductor giant Nvidia to lose billions of dollars. Nvidia announced that the company will record a charge of 5.5 billion dollars in connection with inventories and purchase commitments.
Even under the previous President Joe Biden, the USA created hurdles for the sale of the most modern high-performance chips to China. As a result, Nvidia was only able to supply Chinese companies with a slimmed-down and slower version called H20. However, even these chip systems are now subject to export restrictions due to the trade policy of Biden’s successor Donald Trump, as Nvidia announced.
The company’s chips have become the key technology for the booming artificial intelligence business. Chinese AI developers cannot ignore them either.
There has been speculation for some time about a tightening of export restrictions. As a result, Chinese companies such as Tiktok owner Bytedance, Alibaba and Tencent ordered H20 chips worth at least 16 billion dollars from Nvidia in the first three months of this year alone, the website “The Information” recently reported. This exceeded Nvidia’s previous production capacity for this version, according to sources close to the matter.
dpa
