Nvidia's China Play: Modified H20 AI Chip Set for July Launch Amidst US Export Curbs

Key Points

Nvidia (英伟达) plans to launch a modified H20 AI chip for China in July 2025.
This comes after the U.S. government imposed export licensing requirements on the original H20 chip.
The Chinese market is crucial for Nvidia, accounting for $17 billion USD or 13% of total sales in the last fiscal year.
The modified H20 chip is designed with new technical thresholds resulting in a significant performance downgrade and reduced memory compared to the original.

Nvidia (Yingweida 英伟达) is making a bold move to keep its foothold in the lucrative Chinese market, reportedly planning the launch of a modified H20 Artificial Intelligence (AI) chip this coming July.

This development, highlighted in a May 9, 2025 report from Singapore’s Lianhe Zaobao (联合早报) website, comes roughly a month after the U.S. government tightened the screws, imposing new export licensing requirements on Nvidia’s original H20 AI chip.

Reuters (Lutoushe 路透社), citing three insider sources on May 9th, confirmed that Nvidia (Yingweida 英伟达) has already clued in its major Chinese customers, including heavy hitters in the cloud computing (yunjisuan 云计算) space, about the July rollout for this tweaked H20 chip.

Navigating the Choppy Waters of US Export Controls

The tech world is watching the escalating Sino-US competition, and a key battleground is AI.

The U.S. government isn’t holding back, intensifying efforts to restrict China’s access to high-end chips, aiming to maintain America’s lead in the Artificial Intelligence (AI) race.

This has led to multiple export restrictions slapped on U.S. chip giants like Nvidia (Yingweida 英伟达).

The H20 Chip: From Go-To to No-Go (Without a License)

Since 2023, the H20 chip was Nvidia’s most powerful AI hardware legally shippable to China without a specific license.

That changed last month.

U.S. officials informed the company that future exports of the standard H20 to China would now require an export license.

This effectively banned its shipment under previous conditions.

Nvidia (Yingweida 英伟达) had previously flagged that such restrictions could mean a serious hit to their bottom line, potentially causing losses around $5.5 billion USD.

Key Details on Nvidia’s Adjusted Strategy

Target Market Launch: China
Estimated Release Date: July 2025
Reason for Adjustment: Adapt to U.S. export licensing requirements
Chip Type: Modified H20 AI Chip

Nvidia’s Strategic Pivot: Why China Still Matters

So, why the rush to get a new chip out for China?

Simple: China is one of Nvidia’s (Yingweida 英伟达) most critical markets.

Let’s look at the numbers:

For the fiscal year ending January 26, 2025, the Chinese market brought in a whopping $17 billion USD for Nvidia.
That’s 13% of the company’s total sales.


Affected Chip	Previous Status for China	Current Status for China	Estimated Financial Impact to Nvidia
Original H20 AI Chip	Legally shippable without specific license	Requires Export License for shipment	Potential losses around $5.5 billion USD (as previously flagged by Nvidia)

This move to introduce a downgraded H20 chip is Nvidia’s latest chess move to hold onto its significant market share in the People’s Republic.

The Modified H20 Chip: What’s Under the Hood?

Sources are spilling some details about this China-specific H20.

Nvidia (Yingweida 英伟达) has reportedly established new technical thresholds to guide the design of this modified chip.

Here’s the lowdown from those in the know:

These new specifications will lead to a significant downgrade in the chip’s performance compared to the original H20.
One key area taking a hit will be memory capacity, which is expected to see a substantial reduction.

This strategic adjustment underscores the challenges and compromises tech companies face when navigating complex geopolitical landscapes and stringent export controls, especially concerning advanced AI hardware and the booming Chinese tech market.