Nvidia currently finds itself in a challenging position, as the company has been prohibited from selling its popular H20 AI chips to China. This ban stems from the ongoing trade war, which has severely curtailed Nvidia’s ability to export chips specifically designed for the Chinese market. The H20 chips were in compliance with existing export regulations, yet they have still fallen victim to these restrictions.

The impact of this ban is significant for Nvidia. Prior to the restrictions, the company experienced a substantial 50% increase in quarter-over-quarter sales of the H20 chips. Now, with the ban in effect, Nvidia is projected to suffer losses of at least $5.5 billion.

This situation underscores the volatility and challenges faced by technology companies operating in the current geopolitical climate. In response to Nvidia’s withdrawal from the market, Huawei has stepped forward with the announcement of its new Ascend 920 AI chips. As China’s largest technology company, Huawei has been adapting to the sanctions it faces, having successfully developed its own chips while sourcing domestic components.

The Ascend 920 serves as a successor to the previously launched Ascend 910C and features an impressive 6nm manufacturing process courtesy of SMIC. With a memory bandwidth of 4000GB/s and an astounding 900 TFLOPs performance, the Ascend 920 is poised to become a top alternative for many businesses shifting towards AI solutions. This development highlights the broader consequences of recent trade policies, particularly those influenced by former President Trump’s administration.

Major tech companies such as Google, Meta, and Apple are also experiencing challenges as a result of these trade dynamics, despite some of their CEOs having previously contributed to Trump’s inaugural fund. The evolving landscape of tech competition illustrates the unpredictable nature of international trade relations.