NVIDIA’s Upcoming “Blackwell” Chip for China Could Generate Up to $10 Billion in Revenue This Year, Priced Between $6,500 and $8,000

NVIDIA is poised to unveil its latest chip tailored for the Chinese AI sector in the coming months, with pricing anticipated to be attractive for potential clients.

NVIDIA’s Upcoming Blackwell Chip: A Cost-Effective Option for China

Team Green is under pressure to solidify its standing in the Chinese market, particularly given the intensifying competition from firms like Huawei and the unpredictable geopolitical landscape. Recent insights from a report by Reuters suggest that NVIDIA’s forthcoming Blackwell chip could be priced at approximately half that of the H20 AI accelerator. This strategic pricing is expected to help NVIDIA recapture market share amid rising competition.

Production for the Blackwell chip is set to begin as early as next month, with expectations that it will be available in the Chinese AI market by July. However, the lower price point will come with trade-offs. Notably, the Blackwell chip will utilize GDDR7 memory instead of the high-bandwidth memory (HBM) typically favored in more advanced models, a shift made to align with U. S.export controls concerning memory bandwidth. Additionally, the absence of TSMC’s CoWoS technology will likely result in performance limitations, widening the performance gap between Chinese and Western AI solutions.

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NVIDIA’s revenue from China has plummeted following the initial set of restrictions implemented by the Biden administration. Prior to these changes, the company was generating substantial income from selling “millions”of its AI GPUs, particularly the H100 and A100 models. NVIDIA’s CEO Jensen Huang has emphasized that China represents a $50 billion opportunity, yet current restrictions have significantly hindered their market positioning, resulting in a market share drop to 50%.

The competitive pricing of the Blackwell chip is likely to attract a considerable customer base, with NVIDIA projecting sales of over one million units by year’s end. Nevertheless, it is important to note that, with this release, NVIDIA may no longer stand as the leader in high-performance solutions domestically; Huawei’s Ascend 910C chip is expected to outclass it. Still, NVIDIA intends to capitalize on its robust software ecosystem, particularly CUDA, which may provide a competitive advantage in the marketplace.

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