According to Reuters, Nvidia has informed Chinese customers that it will delay the launch of a new artificial intelligence chip called the H20 designed to comply with US export regulations until the first quarter of next year.
The H20 is one of the company's three China-focused segments and is designed to comply with new US export restrictions.
The delay could complicate Nvidia's efforts to maintain market share in China against local rivals such as Huawei.
According to chip industry newsletter SemiAnalias, the AI chip giant is expected to launch the new product as early as November 16.
Nvidia postponed the launch of the H20 until the first quarter of next year, telling customers that the chip is expected to be available in February or March. The company told its customers there were delays in H20 because the server manufacturer was having difficulties integrating the chips.
In addition to the H20, Nvidia plans to release two additional chipsets — the L20 and L2 — to comply with new US export regulations. The L20 has not seen any delays and is expected to be launched as originally planned. However, there is no information about when the L2 will be launched.
Nvidia is betting on chips to maintain its share in the Chinese market after strict export rules imposed by Washington prevented it from shipping products such as the advanced A800 and H800 artificial intelligence chips.
In November 2022, the company launched the A800 and H800 chipsets as replacements for Chinese customers, about a month after the United States first banned the export of advanced chips and devices to China.
According to an analysis of chip specifications by SemiAnasis, the H20, L20 and L2 chips contain most of Nvidia's latest AI features, although they have reduced some processing power metrics to comply with new US regulations.
US export restrictions provide rivals like Huawei with an opportunity to win contracts that would otherwise go to Nvidia, whose graphics processors dominate the AI market.
This year, Chinese internet giant Baidu placed a large order for AI chips from Huawei even before the US restrictions were announced. Because they are preparing for a future in which they can no longer afford Nvidia products.