Nvidia Cuts Chip Prices in China

Nvidia Cuts Chip Prices in China

Anemic sales in China due to local competition and US restrictions forced Nvidia to cut prices. An oversupply of its AI chips prompted Nvidia to reduce prices below Huawei's.

Nvidia’s top-end chip sold in China, the H20, is offered at a 10% discount to Huawei’s Ascend 910B. The Chinese company’s chips reportedly are produced by state-owned Semiconductor Manufacturing International Corp, which faces trade controls on advanced chipmaking machinery.

Nvidia reconfigured its high-end offerings for China following new US restrictions on AI chips in October 2023. The chipmaker previously said it had not received licenses to ship restricted products to China but started exporting alternatives in small volumes.

In its last annual report released last week, the company said its competitive position has been harmed in China by the US export sanctions. It noted the country represented a mid-single-digit percentage of data center revenue in Q4 due to US licensing requirements and it expected a similar range in the opening quarter. The company didn’t mention China in its Q1 statement.