Nvidia Orders 300,000 H20 Chips Amid Renewed China Demand

Nvidia has placed a new order for 300,000 H20 AI chips with Taiwan Semiconductor Manufacturing Company (TSMC) to meet unexpectedly strong demand from China, reversing its earlier suspension of production following U.S. export restrictions. This move follows the Trump administration's decision to ease export controls on the H20 chips, which are designed specifically for the Chinese market to comply with U.S. trade regulations while being less powerful than Nvidia's flagship H100 and Blackwell GPUs. Despite having an existing inventory estimated between 600,000 and 900,000 units, Nvidia is responding to Chinese demand estimated at around 1.8 million units, with major Chinese tech companies like Tencent, Alibaba, and ByteDance relying on these chips for AI development. Nvidia CEO Jensen Huang has indicated that restarting full production could take up to nine months and depends on sustained order volumes. The U.S. Department of Commerce has not yet granted final export licenses, but Nvidia has been assured they are forthcoming, allowing shipments to resume soon. This strategic engagement aims to retain Nvidia's foothold in China amid fierce competition from domestic firms like Huawei and ongoing trade tensions.