The shortage was due to the cancellation of the manufacturing capacity it had booked at chipmaker Taiwan Semiconductor Manufacturing.
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Nvidia has told its Chinese customers that it has limited supplies of its H20 chips, The Information reported citing unidentified people.
The shortage was due to the cancellation of the manufacturing capacity it had booked at chipmaker Taiwan Semiconductor Manufacturing following the US government's ban on the sale of the H20 chips in April.
Manufacturing new chips from the scratch could take nine months, the report also said citing Nvidia CEO Jensen Huang at a media event in Beijing.
Last week, Huang said that the company will start selling the H20 AI chips to China, ending months of logjam after the Trump administration restricted the sale of the chips to the Asian country.
The H20 chips are a lower-powered version of Nvidia's H100. It was designed to comply with earlier US export restrictions and are widely used in China for AI inference tasks.
Nvidia added that it will also launch "RTX PRO GPU" that “is ideal for digital twin AI for smart factories and logistics" in China.
Earlier in April, in the wake of US President's strict tariff rules, his administration had restricted H20 AI chip sales. This reportedly cost Nvidia $15-$16 billion in revenue.
The US export restrictions had also forced Chinese tech giants such as ByteDance, Alibaba and Tencent to stockpile around 1 million H20 AI chips from Nvidia.
Meanwhile, last week, the head of a House of Representatives panel on China told U.S. Commerce Secretary Howard Lutnick that resuming sales of Nvidia's H20 chips to China threatens to advance Beijing's AI capability.
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