Nvidia Suspends H20 Chip Production in China Due to Security Fears
Nvidia has directed key suppliers, including Samsung, Amkor, and Foxconn, to cease production of its H20 AI chips intended for the Chinese market. This decision follows Beijing’s national security concerns about potential “backdoor” access in the semiconductors.
Chinese regulators have encouraged domestic tech giants, such as ByteDance, Alibaba, and Tencent, to refrain from purchasing Nvidia H20 chips. This advice is particularly relevant for government-related projects. Beijing has expressed worries that the chips could contain tracking technology or remote shutdown capabilities, allegations that Nvidia has consistently refuted.
This action threatens Nvidia’s $20+ billion annual revenue from China, which accounts for 13% of the company’s total sales. This news comes hot on the heels of the Trump administration’s reversal of a previous ban on H20 sales. As part of the export license agreement, Nvidia is now required to pay 15% of its China revenues to the U.S. government.
Source: CNBC Technology News