Nvidia’s sales fell ‘significantly’ in China — but it’s still shipping chips to the country

Nvidia’s sales fell ‘significantly’ in China — but it’s still shipping chips to the country

Nvidia’s data center revenue boomed across almost all regions as companies increasingly turn to their chips to create their own AI models. That helped the semiconductor manufacturer rake in $22.1 billion in quarterly revenue.

One place Nvidia didn’t grow: China, where revenue declined “significantly following the US government export control regulations imposed in October,” Nvidia’s CFO Colette Kress said on the company’s Q4 earnings call.

But Nvidia is still selling alternative versions of its chips that don’t require a US license for export to the country, execs said — and these could help it “compete” in China later this year.

In late 2023, the US introduced regulations to limit the types of semiconductors that can be shipped to China as part of an ongoing effort to crimp China’s ability to access advanced American technology. That’s heightened shareholder worries about Nvidia’s ability to keep up sales in China’s massive AI chip market.

When Nvidia heard about the restrictions, “we reconfigured our products in a way that is not software hackable,” CEO Jensen Huang said on the earnings call. “So we reset our product offerings to China, and now we’re sampling to customers.”

In January, Nvidia started selling a new gaming processor with fewer capabilities than an earlier model, which can be sold in China while still complying with US export rules, Business Insider reported.

And while the company expects performance in the region in this current quarter to be about the same, “after that, hopefully, we can go compete for our business and do our best,” Huang said.

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