On April 17, NVIDIA CEO Jensen Huang rushed to Beijing, marking his second visit to China in just three months. The urgency of this visit was triggered by the U.S. government’s sudden announcement on April 9, imposing “indefinite export controls” on NVIDIA’s H20 chip designed specifically for the Chinese market. This news hit the capital market like a bombshell, causing NVIDIA’s stock price to plummet by 6.9% in a single day, resulting in a market value loss of over one trillion RMB overnight. The company was forced to cancel numerous orders, incurring losses of up to $5.5 billion, significantly increasing operational pressure.
The birth of the H20 chip was NVIDIA’s reluctant response to the complex international situation. In the context of the U.S. chip ban against China, NVIDIA launched this “stripped-down” product to continue capturing a share of the Chinese market. Although the H20 significantly compromises performance compared to NVIDIA’s high-end chips, it accounts for a staggering 93% of the company’s revenue in China. It is not an exaggeration to say that it is the backbone of NVIDIA’s operations in China, supporting its annual revenue of $17.1 billion. Prior to this, Jensen Huang had made considerable efforts to persuade the U.S. government to ease restrictions on related chips, even spending millions to attend a Mar-a-Lago dinner in an attempt to lobby the Trump administration to change its stance. However, contrary to his hopes, all efforts ultimately came to naught, and the ban was implemented mercilessly.
In such a complex and severe environment, what is the true purpose behind Jensen Huang’s hurried visit to China? Let us unravel the truth from his tightly packed itinerary and the intertwined interests of both China and the U.S., as well as the entire technology industry.
Reaffirming Commitment to the Chinese Market, Seeking Policy Buffer
During a formal meeting with Ren Hongbin, President of the China Council for the Promotion of International Trade, Jensen Huang earnestly emphasized, “China is an extremely important market for NVIDIA, and we are committed to serving the Chinese market.” This seemingly simple statement carries profound significance in the current special period. In the past, the U.S. government has continuously introduced a series of chip control measures, creating a tense atmosphere in China’s related industries. Many domestic companies are like startled birds facing great uncertainty in AI chip supply.
According to relevant data, the AI chip market in China exceeded 40 billion RMB in 2021, with AI inference computing accounting for over 50%. The compound annual growth rate (CAGR) is expected to exceed 40% over the next five years. Such a large and highly potential market attracts many companies to enter. As the undisputed leader in the global AI chip field, NVIDIA’s every move serves as a barometer for the industry, drawing significant attention. Jensen Huang’s clear statement at this time aims to reassure a vast number of Chinese customers, striving to avoid large-scale customer loss due to the impact of the ban. It is crucial to note that if customers were to leave in droves, they would likely turn to domestic alternatives such as Huawei’s Ascend or Cambricon’s MLUarch04, which would be a fatal blow to NVIDIA’s foundation in the Chinese market. Currently, Huawei’s Ascend 910B is widely used in industries such as telecommunications and government; Cambricon focuses on AI chip development, with a product system covering cloud, edge intelligent chips, and acceleration cards, serving various industries including internet and cloud computing for intelligent upgrades.
From a policy perspective, the U.S. ban came too suddenly and without warning. China will inevitably conduct a comprehensive and in-depth assessment of NVIDIA’s subsequent actions. Will China introduce corresponding countermeasures? Will it strengthen the scrutiny of NVIDIA’s business in China? These questions are filled with uncertainty at present. Jensen Huang’s repeated emphasis on his determination to serve the Chinese market is, in fact, a message to the Chinese government, hoping that China can understand NVIDIA’s difficult position in the complex chess game of U.S.-China technology competition. He hopes to gain valuable policy space and ample time for NVIDIA’s subsequent adjustments in business layout and active exploration of compliant products.
Exploring Technological Breakthroughs, Collaborating on New Chip Design
According to authoritative reports from the Financial Times, during his visit to Beijing, Jensen Huang specifically met with Liang Wenfeng, the founder of DeepSeek. In this meeting, both parties engaged in in-depth discussions about designing new chips for China, aiming to meet the actual needs of Chinese customers while complying with U.S. regulatory requirements. This initiative clearly demonstrates NVIDIA’s urgent attitude in exploring technological solutions under the immense pressure of the H20 chip ban.
Despite the stringent barriers posed by the U.S. ban, NVIDIA finds it difficult to give up the vast and potential Chinese market. Collaborating with local Chinese companies to design a new chip that meets U.S. regulatory requirements while establishing a foothold in the Chinese market is undoubtedly a highly feasible compromise. This newly designed chip can be specifically adjusted in key aspects such as performance parameters and functional settings. On one hand, it can fully meet the practical needs of Chinese customers in core areas such as AI computing, ensuring competitiveness in the market and preventing easy displacement by competitors; on the other hand, through clever design, it can cleverly circumvent the strict restrictions imposed by the U.S. government on the export of sensitive technologies. It is worth mentioning that DeepSeek has deep expertise in the AI field, having accumulated substantial technical foundations over the years. NVIDIA’s collaboration with DeepSeek can leverage their technical advantages and deep understanding of the Chinese market to quickly and accurately grasp the special needs for chips in China. This will significantly accelerate the entire process from initial design conception to final application of the new chip, effectively improving the product’s adaptability in the Chinese market and thus enhancing market acceptance.
Strategizing in the “AI + Robotics” Arena, Seeking Local Partnerships
During this visit to China, Jensen Huang’s schedule was packed, and notably, he intensively engaged with several Chinese robotics companies such as Yushu Technology and Galaxy General, and specifically visited the National Center for Intelligent Robotics Innovation. This series of tight schedules sends a strong signal: NVIDIA is urgently seeking new business growth points.
In light of the severe restrictions imposed on the AI chip market due to the U.S. ban, NVIDIA has decisively turned its attention to the promising “AI + Robotics” field. China’s robotics industry has developed rapidly in recent years, emerging as a dark horse in the global market, showcasing tremendous market potential. Relevant reports indicate that by 2025, China’s embodied intelligence market is expected to reach 5.295 billion RMB, accounting for about 27% of the global market; the humanoid robot market is expected to reach 8.239 billion RMB, accounting for about 50% of the global market. By 2025, the global embodied intelligence market is expected to reach 19.525 billion RMB, and by 2030, it is expected to reach 232.63 billion RMB, with a CAGR of 64.18%.
NVIDIA itself possesses competitive technological advantages such as the Isaac Sim simulation platform and CUDA software. The Isaac Sim simulation platform is like a magical virtual world, providing robotics developers with a highly realistic virtual environment. In this environment, developers can efficiently conduct various algorithm tests and quickly optimize robot models, significantly shortening the R&D cycle. CUDA software acts as a “super engine” for chips, greatly enhancing the parallel computing capabilities of chips, providing robust technical support for intelligent decision-making and real-time control during the actual operation of robots. Jensen Huang is keenly aware of the immense potential contained within these technological advantages, attempting to leverage them to engage in deep cooperation with many outstanding local robotics companies in China, jointly building a large and comprehensive “AI + Robotics” ecosystem. By attracting a large number of Chinese developers to innovate based on NVIDIA’s technology, NVIDIA aims to further solidify its position in the Chinese market. Even in the current challenging times when hardware sales of AI chips are hindered, NVIDIA can still generate revenue through diversified businesses such as software licensing and technical services, ensuring the company’s basic operations in the Chinese market. More importantly, these strategic moves also lay the groundwork for the future lifting of the AI chip ban or the entry of new compliant chips into the Chinese market, setting the stage for NVIDIA’s resurgence in the Chinese market.
Jensen Huang’s urgent visit to China undoubtedly represents a series of critical and urgent responses taken by NVIDIA for its survival and development against the backdrop of escalating U.S.-China technology competition and the merciless implementation of the U.S. chip ban. Whether it is striving to stabilize existing market share, actively exploring technological breakthroughs, or strategically positioning itself in new arenas for long-term development, all these actions vividly reflect NVIDIA’s high regard for the Chinese market. At the same time, it profoundly highlights the significant impact of the U.S. unilateral sanctions policy on enterprises amid the deep integration of the global technology industry chain. NVIDIA’s various efforts to break through these difficulties also provide a highly valuable reference model for global technology companies in dealing with similar complex international situations.
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Editor ｜ AI Planet Vision
