US-based chipmaker Nvidia’s shares may be soaring after raising its Q2 revenue forecast amid booming demand for graphic processors, but anaemic sales in China due to local competition and US restrictions forced it to cut prices, Reuters reported.
An oversupply of its AI chips prompted Nvidia to reduced prices below those from Huawei, the news agency stated. Nvidia’s top-end chip sold in China, the H20, is offered at a 10 per cent discount to Huawei’s Ascend 910B.
The Chinese company’s chips reportedly are produced by state-owned Semiconductor Manufacturing International Corp, which faces trade controls on advanced chipmaking machinery.
Nvidia re-configured its high-end offerings for China following new US restriction on AI chips in October 2023. The chipmaker previously said it has not received licences to ship restricted products to China but started exporting alternatives in small volumes.
In its last annual report released in last week, the company said its “competitive position has been harmed” in China by the US export sanctions. For example, the mainland accounted for 14 per cent of its data centre revenue last year, down from 19 per cent the previous year.
It noted the country represented a mid-single digit percentage of data centre revenue in Q4 due to US licensing requirements and it expected a similar range in the opening quarter. The company didn’t mention China in its Q1 statement.
China’s government is pushing for self-reliance in critical technologies, particularly chips. Last month, officials reportedly advised operators to remove foreign chips from their networks by 2027.
The post Nvidia cuts chip prices in China on weak demand appeared first on Mobile World Live.
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