Chinese firms including ByteDance and Tencent place $21.5 billion in orders for new Nvidia chips
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The surge in orders for Nvidia’s H20 server chips is driven by booming demand for Chinese start-up DeepSeek’s low-cost AI models.
PHOTO: REUTERS
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BEIJING – Chinese companies including ByteDance, Alibaba Group and Tencent Holdings placed at least US$16 billion (S$21.5 billion) in orders for Nvidia’s H20 server chips in the first three months of 2025, news website The Information reported on April 2, citing two people with direct knowledge of the transactions.
In February, Reuters first reported a surge in orders for the H20 – the most advanced artificial intelligence (AI) processor legally available in China under US export controls – driven by booming demand for Chinese start-up DeepSeek’s low-cost AI models.
Nvidia declined to comment, while ByteDance, Alibaba Group and Tencent did not immediately respond to Reuters’ requests for comment.
The H20 is the primary chip Nvidia is legally permitted to sell in China and was launched after the latest round of US export restrictions took effect in October 2023.
H3C, one of China’s largest server makers, flagged potential shortages of Nvidia’s H20 chip, according to a Reuters report in March.
A potential supply crunch could hinder Chinese firms’ AI ambitions
H3C is a major original equipment manufacturer partner for Nvidia’s AI chips in China, along with Inspur, Lenovo and Huawei’s spin-off x86 server unit, xFusion.
Washington has banned exports of Nvidia’s most advanced chips to China since 2022, concerned that advanced technologies could be used by China to build up its military capabilities.
US President Donald Trump said in February that he intends to impose tariffs of around 25 per cent on the imports of semiconductors and related products.
Nvidia chief executive Jensen Huang has said the company sees little short-term impact, but will move production
China remains a crucial market for Nvidia, with the company reporting an annual revenue of US$17.11 billion from the region, including Hong Kong, in fiscal 2025. REUTERS
