Nvidia Reorders 300,000 H20 Chips from TSMC to Meet Chinese Demand

Nvidia has ordered an additional 300,000 H20 chipsets from TSMC to meet strong demand in China, following the Trump administration's decision to allow the company to resume H20 GPU sales to China. The H20 chip, designed specifically for the Chinese market, offers less computing power than Nvidia's high-end models. The new order adds to an existing stockpile of up to 700,000 units, with around 1 million H20 chips expected to be sold in 2024.

Nvidia Corporation (NVDA) has placed an order for an additional 300,000 H20 chipsets from Taiwan Semiconductor Manufacturing Co. (TSMC), following the Trump administration's recent decision to allow the company to resume sales of H20 graphics processing units (GPUs) to China. This move is aimed at meeting strong demand for the AI accelerators in the Chinese market [1].

The H20 chip, developed specifically for the Chinese market, offers less computing power than Nvidia's high-end models but is designed to excel in memory bandwidth, making it crucial for large-scale AI development. The new order adds to an existing stockpile of 600,000 to 700,000 units, bringing the total inventory to around 1 million H20 chips, which is expected to be sold by the end of 2024 [2].

The Trump administration's decision to lift the ban on H20 sales to China is part of ongoing negotiations between the U.S. and China over rare earth magnets. The move has drawn bipartisan criticism from U.S. legislators who are concerned about China's access to advanced AI technology [3]. However, Nvidia maintains that the H20 chip will not enhance China's military capabilities and is essential for retaining the interest of Chinese developers in Nvidia's products [1].

Nvidia's stock has seen a significant increase since the lifting of the ban, adding nearly 32% year-to-date and closing at $176.75 on Monday, just shy of its record intraday high of $177. The stock remained bullish on Tuesday, with retail sentiment towards the stock at 72/100 and high message volume on Stocktwits [1].

The U.S. Commerce Department has yet to officially approve the export licenses for the H20 chips, but Nvidia has been assured by authorities that they will be granted soon. The company has asked Chinese companies interested in purchasing Nvidia H20 chips to submit new documentation, including order volume forecasts [2].

References:
[1] https://stocktwits.com/news-articles/markets/equity/nvidia-stock-on-track-for-fresh-peak-after-reportedly-ordering-300-k-h20-ai-chips/cho9NZLR5U3
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L4N3TP0D1:0-nvidia-orders-300-000-h20-chips-from-tsmc-due-to-robust-china-demand-sources-say/
[3] https://the-decoder.com/former-officials-say-nvidias-h20-chip-will-aid-chinas-military-ai/