Nvidia said late Thursday that recently announced US export regulations require the company to obtain an export license to sell high-performance graphics processors to China. On the one hand, these new policies could already cost the company about $400 million in revenue this quarter. On the one hand, this will prevent him from completing the development of the H100 early, which may further affect the sales of the company’s data center products.
“On August 26, 2022, the U.S. Government or USG will inform Nvidia that the USG will take effect immediately on future exports of our A100 and future integrated H100s to China (including Hong Kong) and Russia. We have notified you that we have imposed new licensing requirements. statement (opens in new tab) According to Nvidia reading.
To prevent Nvidia’s high-performance GPUs from being used by enemy forces, the U.S. government is now banning exports to sell existing or future GPUs that “achieve both peak performance and chip-to-chip I/O performance.” I am requesting Nvidia to obtain a license. […] This is roughly equivalent to the A100′ and similar to systems found on Chinese or Russian bases.
An export license is required to ship physical products to clients for revenue, or to ship product samples to partners to support product development. As a result, Nvidia could miss out on its expected $400 million in data center sales from China in the third quarter of 2023, earlier this quarter, if the proper licenses aren’t granted in time. Nvidia’s data center revenue totaled $3.86 billion last quarter, which includes computing GPUs and a range of Mellanox solutions, so $400 million is a significant amount for the company.
In addition, Nvidia has a number of manufacturing partners in China, so if it cannot ship samples, it will not be able to complete the development of its Hopper H100-based products (and Grace Hopper-based products as well) on time, which will impact its data. may give. Core earnings for Q4 2023 (ending late January 2023).
“The new licensing requirements could impact our ability to complete H100 development in a timely manner or support existing A100 customers, requiring us to move certain operations out of China. “The company is involved with USG and is seeking waivers for its internal development and support activities.”
Nvidia’s A100 is the company’s current-generation data center GPU, introduced in mid-2020. Nvidia’s A100X and H100 offer better performance than his A100, so he automatically needs Nvidia to get the license. On the other hand, a scaled-down version of the Hopper H100 will likely outperform the A100 (unless Nvidia deliberately underperforms to make it less competitive), so Nvidia cannot sell it to Chinese clients without an export license. Nvidia, on the other hand, no longer sells products to Russia.
One way Nvidia circumvents data center GPU export requirements is by selling A30 products to customers in China and Hong Kong instead of A100 products. Of course, the A30 offers significantly lower performance than his A100 and doesn’t offer similar scalability. Still, if you need an Nvidia GPU for artificial intelligence, analytics, or high-performance computing, the A30 is your go-to choice.
“Additionally, the company is working with customers in China to fill their planned or future purchases of data center products with products that are not covered by the new licensing requirements,” Nvidia said. “The company’s third-quarter outlook, provided on August 24, 2022, includes approximately $400 million in potential sales to China and customers are reluctant to buy alternative products from the company. or purchased by USG, we may be subject to new licensing requirements, fail to grant licenses in a timely manner, or deny licenses to critical customers.”