Nvidia (NASDAQ:NVDA) CEO Jensen Huang recently discussed the problems created by U.S. sanctions against China and how they are harming Nvidia’s business. While the tech giant is facing restrictions on exporting its most advanced chips to China, Huang believes that Nvidia’s global impact is still a major win for the United States.
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In a short interview, Huang shared his thoughts on how his company is balancing national security and technological progress. He emphasized that the U.S. government is doing its best to navigate these tough waters while ensuring that American companies like Nvidia continue to succeed on the world stage.
“We have to defer all of the policymaking to the administration,” Huang said, continuing 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, which is really terrific for the U.S. The world is built on American standards.”
Nvidia, an American company leading the charge in artificial intelligence (AI) chip technology, has been deeply affected by these sanctions. Yet, Huang shared that, “Nvidia is an American company, and our government and the administration would love to see us succeed.”
The restrictions were put in place to prevent China from using advanced AI chips in its military, which could risk national security. However, these sanctions have also made it harder for Nvidia to sell its most powerful chips, like the H100 and B100, to China, one of its biggest markets, contributing around 17% of its revenue for fiscal 2024.
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Nvidia launched customized chips, such as the H20, for the Chinese market to comply with U.S. restrictions. The market for these chips hasn’t been as strong as anticipated.
Nvidia reportedly had to lower the price of its H20 processor to compete with Chinese firms like Huawei, which produces the Ascend 910B AI chip. Given the challenging market conditions in China, Nvidia’s H20 chip is being sold at a discount of more than 10% compared to Huawei’s offering.
In addition, China has been pushing domestic manufacturers of AI chips to support the growth of its semiconductor sector. Due to the pressure from Chinese authorities, it is now much more difficult for Nvidia to maintain its market dominance in China.
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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-gen Blackwell GPU platform has been “insane.” The Blackwell chips, expected to launch in full production by the fourth quarter of 2024, are projected to deliver 2.5 times the performance of Nvidia’s previous Hopper chips.
“Blackwell is in full production, Blackwell is as planned, and the demand for Blackwell is insane,” he said on CNBC’s Closing Bell Overtime, adding, “Everyone wants to have the most, and everyone wants to be first.”
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This article Jensen Huang On China Sanctions – ‘We’re Exporting American Technology Which Is Really Terrific For The U.S.,’ Says Government Backs Nvidia originally appeared on Benzinga.com
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