Amidst swirling rumors about NVIDIA halting production of its H20 AI chips, it turns out there’s been a significant uptick in orders at TSMC, driven by surging demand from Chinese buyers.
NVIDIA’s decision to ramp up H20 AI chip orders follows a wave of strong interest from China, setting the stage for robust activity in the coming quarters.
Recently, NVIDIA received the go-ahead to initiate chip sales in China, effectively unlocking a crucial revenue stream. The breakthrough came after chip export controls to China were relaxed, a move that paves the way for H20 shipments. Initially, there was market skepticism about NVIDIA’s ability to produce more H20 chips due to supply chain hurdles. However, a recent report reveals NVIDIA is poised to boost inventory levels for Chinese AI consumers.
Reportedly, NVIDIA has placed a substantial order for 300,000 units of the H20 AI chip with TSMC. This move addresses the considerable demand they’re experiencing in China. With this order, NVIDIA’s total H20 chip inventory is expected to reach between 600,000 and 700,000 units, ensuring at least two to three quarters’ worth of supply for their business in the region.
Currently, NVIDIA seems to be conducting a “market survey” to fine-tune its order volumes for the H20 AI chip, as this solution has been available domestically for some time. With soaring computing needs, particularly in Beijing, NVIDIA’s next focus could likely be on expanding its offerings. This might include the anticipated release of “Blackwell-based” B20 AI chips and GeForce RTX 6000D GPUs, projected to hit the Chinese market by late this year or early 2026, contingent on US export policies.
In essence, NVIDIA’s journey in China is unfolding dynamically. It appears the company, under the leadership of Jensen, is firmly committed to maintaining its presence in the domestic market, capitalizing on the recent shift in policy to promote American AI products in China.
