Nvidia (NASDAQ:NVDA) is set to begin delivering a new AI chip tailored to comply with U.S. export restrictions for China in the upcoming months, according to a report from Nikkei Asia over the weekend. Additionally, the company is preparing to release a modified version of its flagship Blackwell chip specifically for the Chinese market sometime later in 2025.
The upcoming AI chip designed for China will be a scaled-down variant based on Nvidia’s previous Hopper generation and notably will omit high-bandwidth memory (HBM). This marks a downgrade from the current H20 chip Nvidia supplies to Chinese customers.
Sources familiar with the matter told Nikkei that the Blackwell chip planned for China will also exclude HBM to align with U.S. export control regulations.
Nvidia’s efforts to roll out new, compliant chips come amid increasing pressure from U.S. authorities tightening rules on AI technology exports to China. Maintaining its foothold in the region remains a priority for Nvidia, especially as domestic chipmakers like Huawei ramp up competition.
Earlier this year, Nvidia’s H20 chip was among its best-selling products in China, widely utilized by prominent Chinese AI firms such as DeepSeek, Bytedance, Alibaba (NYSE:BABA), and Baidu (NASDAQ:BIDU).
Despite the challenges posed by export restrictions and local competitors, China still represented approximately 14% of Nvidia’s revenue in 2024. CEO Jensen Huang has projected that the Chinese chip market could expand to as much as $50 billion over the next few years.