Nvidia (NASDAQ:NVDA) CEO Jensen Huang recently spoke about the problems caused by US sanctions against China and how they are negatively impacting Nvidia’s business. Although the tech giant faces restrictions on exports of cutting-edge chips to China, Huang believes Nvidia’s global influence is still a big win for the United States.
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In a short interview, Huang shared his thoughts on how his company balances national security and technological advancement. He stressed that the U.S. government is doing its best to navigate these difficult waters while ensuring that American companies like Nvidia continue to succeed on the world stage.
“We must leave all policy decisions to the administration,” Huang said, adding that the administration understands the need to balance national security with the prosperity of American technology.
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“We’re exporting American technology. This is a really great thing for America. The world is built on American standards.”
Nvidia, a US company at the forefront of artificial intelligence (AI) chip technology, has been hit hard by these sanctions. Still, Huang said, “NVIDIA is an American company, and our government and administration really want us to succeed.”
The restrictions were introduced to prevent China from using advanced AI chips in its military that could jeopardize national security. But these sanctions have made it difficult for NVIDIA to sell its most powerful chips, such as the H100 and B100, to China, one of its largest markets, accounting for about 17% of its fiscal 2024 revenue.
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Nvidia has launched customized chips such as H20 for the Chinese market to comply with US regulations. The market for these chips is not as strong as expected.
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NVIDIA reportedly needed to lower the price of its H20 processor to compete with Chinese companies like Huawei, which produces the Ascend 910B AI chip. Considering the difficult market conditions in China, Nvidia’s H20 chips are sold at a discount of more than 10% compared to Huawei’s products.
Furthermore, China is encouraging domestic AI chip makers to support the growth of its semiconductor sector. Pressure from Chinese authorities has made it extremely difficult for Nvidia to maintain its dominance in the Chinese market.
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Beyond its struggles in China, Nvidia continues to see strong global demand for its AI chips. Jensen Huang recently revealed that demand for the company’s next-generation Blackwell GPU platform is “insane.” The Blackwell chip is expected to be in full-scale production by the fourth quarter of 2024 and is expected to deliver 2.5 times the performance of Nvidia’s previous Hopper chip.
“Blackwell is fully operational, on schedule, and the demand for Blackwell is insane,” he said on CNBC’s Closing Bell Overtime, adding, “Everyone wants to get the most. “Everyone wants to be the best,” he added.
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This article: Jensen Huang talks about China sanctions – “We’re exporting American technology that’s really great for the United States” says the government supports NVIDIA.
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