Nvidia could lose up to $12 billion in revenue if US bans new China-oriented GPU — analysts believe the H20 will get the banhammer soon

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Nvidia could lose up to $12 billion in revenue if US bans new China-oriented GPU — analysts believe the H20 will get the banhammer soon

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The U.S. is considering new trade restrictions that could prevent Nvidia from selling its China-oriented 

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 AI GPU, according to a Jefferies note to clients, reports 

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. This is part of the U.S. government’s plan to restrict China’s access to advanced AI technology, and if implemented, it could cost Nvidia an estimated $12 billion in revenue.

Nvidia’s new HGX H20 GPUs are designed to comply with U.S. export rules while still offering strong AI performance. They provide up to 296 INT8 TOPS/FP8 TFLOPS, 96 GB of HBM3 memory, and 4.0 TB/s memory bandwidth, making them competitive against entry-level AI processors. Despite appearing less potent on paper, the HGX H20 outperforms its direct competitor, Huawei’s Ascend 920-series AI processors, in practical applications due to better memory performance. It is what concerns U.S. lawmakers.

Nvidia’s H20 product may face a sales ban when the U.S. reviews its semiconductor export policies in October, reports QZ based on a Jefferies report. This ban could take several forms, including a product-specific prohibition, a reduction in a chip’s computing power, or a limit on its memory capacity.

Most ******** AI companies have developed their application ecosystems on Nvidia’s CUDA platform, so transitioning to others (e.g., Huawei Ascend) would be expensive and time-consuming. Given that the HGX H20 GPU is fully compatible with Nvidia’s CUDA platform, it is the preferred choice for many companies and applications despite being significantly slower than the full-featured H100.

It is noteworthy that despite existing export controls, ******** companies have obtained advanced Nvidia GPUs for AI and HPC through intermediaries and by renting servers from companies like

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and

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inappropriate cloud services.

The U.S. may also extend export restrictions to other ****** countries, such as Malaysia, Indonesia, Thailand, and potentially overseas ******** companies. However, the report says enforcing these extended controls would be complex and challenging to implement effectively.

Enforcing (or denying) access to ******** entities from the cloud might be problematic. Given the vast processing performance requirements for AI large-language training, it is almost inevitable that ******** entities will access GPU performance one way or another, which means they would simply rent instances in the cloud.

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