Nvidia CEO Visits China After US Bars Some Chip Sales

Key Concepts:

• Jensen Huang's visit to Beijing
• Nvidia's H-20 chip
• US export license requirement
• Inventory write-down
• Chinese Communist Party's advisory
• Chinese National Development and Reform Commission
• Domestic alternatives (Huawei)

Jensen Huang's Visit to Beijing:

• Jensen Huang's visit to Beijing is considered normal due to Nvidia's significant employee presence in China.
• He visits China more than once a year.
• He met with the vice premier, according to Chinese news agency reports.

US Export License Requirement and Nvidia's H-20 Chip:

• The US government is not deeming the H-20 chip illegal or non-compliant with parameters.
• The US government is requiring Nvidia to obtain a license for H-20 exports.
• Nvidia opted for a $5.5 billion write-down on inventory of tees, inferring they will not apply for a license.

Chinese Communist Party's Advisory:

• The Chinese Communist Party has advised companies not to buy Nvidia's H-20 chips.
• The Chinese National Development and Reform Commission issued an advisory to domestic technology buyers.
• The advisory stated that the H-20 chip does not conform to rules related to energy, raw materials, and supply chain composition requirements.
• Large Chinese technology companies like Alibaba, Tencent, and Bytedance were the biggest buyers of H-20 and had already built up inventory.

Impact and Alternatives:

• The US policy has a side effect: if Chinese tech companies can't use H-20, they will look for alternatives.
• Huawei has a similar accelerator, presenting an opportunity for China to champion its domestic option.

Synthesis/Conclusion:

The situation involves a complex interplay of US export regulations, Chinese government influence, and market dynamics. While the US isn't banning the H-20 chip outright, the license requirement, coupled with the Chinese Communist Party's advisory, effectively limits its adoption in China. This creates an opportunity for domestic alternatives like Huawei's accelerator to gain traction.