Nvidia to Launch Affordable Blackwell AI Chip for China Amid U.S. Export Restrictions

Facing mounting U.S. export restrictions, Nvidia is preparing to launch a new, lower-cost artificial intelligence (AI) chip specifically for the Chinese market. This move marks the company’s third attempt to tailor its products to comply with tightening regulations while maintaining its foothold in a critical global market.

New Blackwell-Based GPU Priced Between $6,500 and $8,000

According to sources familiar with the matter, the upcoming GPU will be part of Nvidia’s cutting-edge Blackwell architecture. It is expected to be priced between $6,500 and $8,000, significantly lower than the $10,000 to $12,000 price tag of the recently banned H20 model. The price cut reflects reduced performance specs and a simpler manufacturing process.

Conventional GDDR7 Memory, No Advanced CoWoS Packaging

The new chip will be based on the RTX Pro 6000D, a server-class GPU that will utilize standard GDDR7 memory rather than advanced high-bandwidth memory (HBM). Additionally, it will not use TSMC’s CoWoS (Chip-on-Wafer-on-Substrate) packaging technology, which is typically used in high-performance AI chips.

Details such as pricing, specifications, and production timeline for the new chip have not been previously disclosed.

Mass Production to Begin as Early as June; Another Variant Coming in September

Mass production of this cost-effective Blackwell chip is slated to begin in June, while a second Blackwell-based chip customized for China is expected to enter production by September, sources say.

Although the final product name remains unconfirmed, Chinese brokerage firm GF Securities speculates it could be called the 6000D or B40.

China Market Still Critical Despite Shrinking Share

Despite U.S. export curbs, China remains crucial to Nvidia, accounting for 13% of its annual revenue. However, Nvidia’s market share in China has fallen from 95% in 2022 to just 50%, according to CEO Jensen Huang. The primary competitor in the region is Huawei, which produces the Ascend 910B AI chip.

Huang warned that continued restrictions could push Chinese customers toward domestic alternatives like Huawei’s chips.

Heavy Losses from H20 Ban and Export Curbs

The H20 ban forced Nvidia to write off $5.5 billion in inventory and walk away from $15 billion in potential sales, according to Huang. The latest U.S. regulations now include strict limits on GPU memory bandwidth, a critical factor for AI workloads.

New limits cap memory bandwidth at 1.7 to 1.8 terabytes per second (TB/s)—a significant drop from the 4 TB/s capacity of the H20. GF Securities estimates the new Blackwell chip will operate just within these limits using GDDR7 memory, reaching around 1.7 TB/s.

Conclusion

Nvidia’s launch of a cheaper, regulation-compliant Blackwell AI chip for China is a strategic response to evolving geopolitical and technological challenges. However, with increased competition from Huawei and tight U.S. export limits, the company’s ability to maintain dominance in China’s booming AI sector remains uncertain.

Gain a competitive edge with up-to-date market intelligence from InfoFinance – follow us for the latest insights.

Source: CNBC