"Nvidia's shifting China plans over the past several months turned mostly on two things. The U.S. government worried the chips would help China gain on America in the race for AI supremacy. Then, China told the world it could quickly build its own powerful chips that would match the performance of Nvidia chips. The Chinese effort to catch Nvidia even had a name: the "Manhattan Project." It was meant to mirror the U.S. effort to build the atomic bomb in World War II."
"It is too early to say for certain. Reuters reports that China has begun to block imports of the powerful H200. That is Nvidia Corp.'s ( NASDAQ: NVDA) second-most powerful chip. The company's stock price relies somewhat on the belief that the door is wide open to sell its chips to the second-largest artificial intelligence (AI) market in the world."
Chinese customs authorities have been told that Nvidia's H200 artificial intelligence chips are not permitted to enter China, effectively blocking imports of the company's second-most powerful chip. Nvidia's stock and growth assumptions rely partly on access to the Chinese AI market, which the CEO estimated could be worth $50 billion. U.S. concern focused on preventing advanced chips from aiding China's AI capabilities. China asserts it can rapidly produce comparable high-performance chips through a domestic "Manhattan Project" effort. It remains unclear whether the import block will force Chinese AI firms to adopt domestically made chips.
Read at 24/7 Wall St.
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