NVIDIA suddenly announced that the inventory of the H20 chip is sold out and production will cease! The hundred billion yuan orders from Chinese companies evaporated overnight, and netizens exploded: Are they trying to force us to be self-reliant?
According to Observer Network on January 15, NVIDIA suddenly announced that it would stop production of the H20 chip once the existing inventory is sold out. The news caused an uproar in the entire tech circle.
It should be noted that this is a “hot cake” for which Chinese companies had just placed orders worth hundreds of billions.
Just as discussions about cooperation were ongoing, this sudden announcement came. Netizens were furious: “Isn’t this a scam? We placed orders, and you just decide to stop?”
Even more outrageous is that just a month ago, NVIDIA CEO Jensen Huang emphasized in various occasions that “the Chinese market is our important partner.” Just after that, such a big reversal occurred.
The calculations are clear
Let’s first calculate this account.
The unit price of the H20 chip is about 250,000 RMB, and according to previously reported order volumes, the total procurement scale from Chinese companies exceeds 40 billion. Such a big cake, and they just say they don’t want it?
The problem is that NVIDIA’s reasoning is even more baffling—”Limited inventory cannot meet global demand.”
Come on.
The financial reports for the first two quarters showed that NVIDIA’s H20 production capacity was continuously expanding. Now suddenly saying that capacity is insufficient? Who believes that?
Netizens hit the nail on the head: “This is not a capacity issue; it’s an attitude issue. They don’t take us seriously at all.”
Policy Shift
The truth soon surfaced.
According to the Wall Street Journal, the U.S. Department of Commerce is reassessing the export policy for AI chips to China. The H20, as a “stripped-down version” chip, may face stricter regulations.
NVIDIA is making preemptive arrangements. Rather than waiting to be passively attacked, it’s better to take the initiative to withdraw.
But this way, Chinese companies become the victims.
“What about those who signed contracts? Who will pay the penalty for breach of contract?” an executive from an AI company angrily said.
Even worse, the discontinuation of the H20 directly affects the progress of several key projects in the country. A leading internet company originally planned to use the H20 to build a large model training cluster, but now all plans are shelved.
Opportunities for Domestic Chips
However, NVIDIA’s move to “cut off the supply” has actually opened up significant space for domestic chips.
Huawei’s Ascend 910B computing power is close to the H20 level. Cambricon’s Siyuan 590 offers a better price-performance ratio than similar products.
The most critical point is that these chips will not suddenly “run out of stock.”
“Foreign chips are unreliable; we need to rely on our own products,” lamented a CTO from a tech company.
Data further illustrates the issue. IDC’s latest report shows that the market share of domestic AI chips is expected to grow by 156% year-on-year in 2024, even with the normal supply of the H20.
Now that the H20 is discontinued, the spring of domestic chips has truly arrived.
What Are the Americans Calculating?
The logic behind this matter is actually very clear.
The U.S. wants to make money from China while fearing that China develops too quickly. Thus, they come up with this “chokehold” tactic.
But they miscalculated.
The scale of the Chinese AI market exceeds 200 billion USD. Losing this market would not just be a minor loss for NVIDIA.
The stock price has already given the answer. After the news broke, NVIDIA’s stock price fell by more than 3% in after-hours trading.
Investors are not foolish; they can see that this is self-sabotage.
Netizens’ Brilliant Comments
The comments online are even more exciting.
“Thanks to NVIDIA for letting us realize what it means to ‘rely on oneself rather than others.'”
“H20 discontinued? Just in time for domestic chips to rise to prominence.”
“Don’t rush to criticize; this is a good thing. It forces us to be self-reliant and strong.”
“Looking back three years from now, today may be the turning point for the rise of domestic chips.”
The most striking comment is: “NVIDIA is giving Huawei free advertising.”
Indeed, the biggest beneficiaries of the H20 discontinuation are domestic manufacturers like Huawei and Cambricon.
Orders will naturally flow to them. Technological accumulation will accelerate. The entire industry chain will benefit.
Hardcore Conclusion
As things have developed to this point, it is already very clear.
NVIDIA’s “supply cut” is not accidental; it is inevitable. In the context of great power competition, any dependency can become a vulnerability.
Fortunately, we have alternatives.
Huawei Ascend, Cambricon Siyuan, Haiguang DCU—these domestic chips are not to be underestimated.
They have performance, an ecosystem under construction, and rapidly improving mass production capabilities.
Most importantly, they will not suddenly “run out of stock.”
The wheels of the times roll forward, never waiting for anyone. NVIDIA can choose to leave, but the pace of AI development in China will not stop.
The era of domestic chips has arrived.
