Nvidia Cuts China Prices of H20 AI Chip Amid Huawei Competition, 17% Revenue Impact

May 24, 2024, 08:01 AM

Nvidia has reduced the price of its most advanced AI chip, the H20, in the Chinese market amid competition with Huawei. The price cut comes as Nvidia faces challenges due to US sanctions and an abundant supply of the H20 chip, which has led to weaker demand. The H20 chip, Nvidia's most powerful product sold in China, is now priced below Huawei's Ascend 910B, highlighting the competitive pressure Nvidia is under. Nvidia's China business contributed 17% to its revenue for FY'24. Beijing's directive for local firms to buy Chinese chips has further complicated Nvidia's position in the market. Sources cited by Reuters noted the impact on Nvidia's previously strong 77% margins.