Chinese firms place US$16 billion in order for new Nvidia chips, the Information reports

Chinese companies including ByteDance, Alibaba Group (9988) and Tencent (0700), have placed at least US$16 billion (HK$124.8 billion) in orders for Nvidia's H20 server chips in the first three months of the year, the Information reported on Wednesday, citing two people with direct knowledge of the transactions.

In February, Reuters first reported a surge in orders for the H20 - the most advanced AI processor legally available in China under US export controls- driven by booming demand for Chinese startup DeepSeek's low-cost AI models.

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.

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 he intends to impose tariffs of around 25 percent on the imports of semiconductors and related products.

Nvidia chief Jensen Huang Jen-hsun has said the company sees little short-term impact but would move production to the United States in the longer term.

REUTERS