Nvidia Halts H20 Chip Production Amid US–China Dispute

Nvidia, the world's most valuable company, has halted production of the H20 chip after China instructed its tech giants not to purchase it. This is the same chip that was behind the US-China conflict.

Recently, the US allowed Nvidia to sell the chip in China, but President Donald Trump imposed a condition that the US government receive 15% of the export earnings. Previously, the United States had blocked the sale, citing national security concerns. The H20 chip is primarily used for artificial intelligence applications.

Key Highlights

• Nvidia halts H20 chip production after Chinese regulators discouraged sales, citing alleged security risks and national dependencies.
• CEO Jensen Huang reassures no backdoors in the chip, pauses production while negotiating a successor based on Blackwell.​ 

What is the dispute between the United States and China over chips?

Earlier in 2023, the Biden administration restricted sales of advanced chips to China. Nvidia then designed the H20 chip specifically for the Chinese market. However, the Trump administration blocked its sale in April of this year. Nvidia CEO Jensen Huang lobbied for months to resume sales, even meeting with Trump personally to make his case. Trump eventually approved sales to China, describing the H20 as a "older product." Despite this, Beijing has ordered its tech firms to stop buying it.

Also Read: NVIDIA CEO: AI Will Advance With or Without US, Defends H20 Sales to China

Why Did China Block Sales?

According to reports, Nvidia has instructed its suppliers, which include Amkor Technology (US), Samsung Electronics (South Korea), and Foxconn, to halt H20 production and assembly. Chinese regulators have instructed leading companies such as Tencent, ByteDance, and Alibaba to suspend H20 orders due to concerns about data leaks and remote access to the chip.