Nvidia has ordered key suppliers including Amkor Technology, Samsung Electronics and Foxconn to temporarily halt production of H20 chips due to strained relations with Chinese regulators. According to media reports, Chinese authorities have warned technology companies such as ByteDance, Alibaba and Tencent to temporarily halt purchases of H20 chips due to national security concerns. The main concerns were possible \u201cbackdoors\u201d and remote access. China also recently reportedly summoned Nvidia to defend itself over the chip\u2019s design.
Although the US approved the export of H20 chips in April, shipments have not yet been made. Nvidia has confirmed that it is actively managing its supply chain based on market conditions. In May this year, Nvidia announced a $4.5 billion write-down of unsold H20 chip inventories, with quarterly profit likely to have been \u20ac2.3 billion higher had there not been export restrictions.
Chief Executive Jensen Huang said in Taiwan on Friday that the H20 chip is strictly a commercial product, not for military use. \u201cThere are no backdoors,\u201d he said. \u201cWe are working with both governments transparently.\u201d Analysts have warned that a complete ban on H20 chips could threaten Nvidia\u2019s $20 billion in annual sales in China, although sales of lower-priced models could continue into 2026.<\/p>\n