Nvidia Denies Report Of Re-Entering Chinese Market With Custom AI Chip, Despite US Restrictions: 'We Are Still Evaluating...'

Nvidia Corporation (NASDAQ:NVDA) has denied reports that it is re-entering the Chinese market with a new AI chip, despite a previous ban by the U.S. government.

What Happened: Nvidia supplier, Shenzhen-based ZJK Industrial (ZJK) is ramping up production to cater to the increasing demand for Nvidia’s B40 project. The B40 chip, a custom AI accelerator, is specifically designed for the Chinese market and is based on Nvidia’s Blackwell architecture. ZJK stated that it aims to commence mass production as early as this month, reported Investor’s Business Daily.

In a statement obtained by the publication, Nvidia denied the news. “We are still evaluating our limited options. Until we settle on a new product design and receive approval from the U.S. government, we are effectively foreclosed from China’s $50 billion data center market,” clarified the Jensen Huang-led company.

ZJK manufactures precision fasteners and metal parts for industries like electronics, automotive, aerospace, energy storage, medical devices, and AI supercomputer cooling systems. The company’s CEO, Ning Ding, highlighted the B40 project’s market advantages and expects B40 chip shipments to exceed one million units by the end of 2025.

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Why It Matters: Reports of Nvidia re-entering the Chinese market come after the company abandoned the release of its Hopper series chip in China due to U.S. restrictions. Nvidia’s CEO, Jensen Huang, confirmed that further modifications to the Hopper series were not feasible.

Moreover, Huang has previously criticized U.S. chip export controls as counterproductive to America's technological leadership. He revealed that Nvidia wrote off $5.5 billion in inventory and walked away from approximately $15 billion in sales due to these restrictions.

The company’s first-quarter financial results were also impacted by the China export ban. However, Huang stated that the demand was ‘incredibly strong.’

Benzinga's Edge Rankings place Nvidia in the 74th percentile for momentum and the 99th percentile for growth, reflecting its strong performance in both areas. Check the detailed report here. 

Over the past month, the stock surged 23.30%.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.