Chinese firms still want Nvidia chips despite government pressure not to buy, sources say

Chinese firms still want Nvidia chips despite government pressure not to buy, sources say

• Alibaba, ByteDance and Tencent still keen on Nvidia chips, sources say
• Potential B30A chip may cost double the H20 and seen as a good deal by Chinese firms, sources say
• Chinese government wants local firms to wean off U.S. chip tech

Sept 4 (Reuters) – Alibaba (9988.HK), ByteDance and other Chinese tech firms remain keen on Nvidia’s (NVDA.O),artificial intelligence chips despite regulators in Beijing strongly discouraging them from such purchases, four people with knowledge of procurement discussions said.

They want reassurance that their orders of Nvidia’s H20 model, which the U.S. firm in July regained permission to sell in China, are being processed, and are closely monitoring Nvidia’s plans for a more powerful chip, tentatively named the B30A and which is based on its Blackwell architecture, two of the people said.

The B30A – if approved for sale by Washington – is likely to cost about double the H20, which currently sells for between $10,000 and $12,000, those two people said.

Chinese tech firms perceive the potential B30A pricing, reported by Reuters for the first time, as a good deal, they added. One said the B30A promises to be up to six times more powerful than the H20.

Both chips are downgraded versions of models sold outside China, developed specifically to comply with U.S. export restrictions.

All sources for this article were not authorised to speak to media and declined to be identified.

The extent to which China, which generated 13% of Nvidia’s revenue in the past financial year, can have access to cutting-edge AI chips is one of the biggest flashpoints in the U.S.-Sino war for tech supremacy.

On one hand, the U.S. has retreated from its previous position of more severe restrictions on Nvidia sales of advanced chips to China. Nvidia and other critics of the controls say it is better if Chinese firms continue to use its chips – which work with Nvidia’s software tools – so that developers do not completely switch over to offerings from rivals like Huawei (HWT.UL).

U.S. President Donald Trump has also struck a deal with Nvidia for it to give the U.S. government 15% of its H20 revenue.

At the same time, China is keen for its tech industry to wean itself off U.S. chips. Chinese authorities have summoned companies, including Tencent (0700.HK), and ByteDance, over their purchases of the H20, asking them to explain their reasons and expressing concerns over information risks, sources said last month.

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Chinese firms still want Nvidia chips despite government pressure not to buy, sources say, source