China remains an important market for the American company Nvidia, but the share of core revenue is steadily declining as American sanctions expand. After the ban on the supply of H20 accelerators to China, the head and founder of Nvidia Jensen Huang visited the country, but he did not discuss the creation of joint ventures with local market players.
Image source: NVIDIA
Nvidia CEO plans to set up a joint venture in China to help the company better serve local customers amid U.S. sanctions were rumored Monday by popular Taiwanese publication DigiTimes. When contacted by the South China Morning Post, Nvidia denied the speculation.
In just one quarter, Nvidia will lose about $5.5 billion due to the ban on the supply of H20 accelerators to China, and the company’s losses by the end of the current year may significantly exceed $10 billion, since Chinese customers anticipated the tightening of US export control rules and tried to stock up on H20 accelerators for future use. After the new restrictions came into force, the head of Nvidia urgently went to China for the second time in the last three months, which is why rumors arose about a possible search for workarounds to preserve the company’s core business in the Celestial Empire.
During his recent visit to China, the founder of Nvidia also met with Vice Premier He Lifeng, who is responsible for international trade negotiations with the United States, and Shanghai Mayor Gong Zheng. As noted, Huang’s trip to China this time was carried out at the invitation of one of the local associations representing the interests of Chinese exporters. Local media reported that before the ban on the supply of Nvidia H20 accelerators to China, Tencent, Alibaba and ByteDance bought them for a total of $13.7 billion to create an adequate reserve for work under sanctions. ByteDance later denied this information.