Nvidia Asks Foxconn to Halt H20 Chip Production Amid U.S. Export Restrictions

Nvidia has instructed Foxconn to pause production of the H20 AI chip, the most advanced product the U.S. semiconductor giant is currently allowed to sell to China, according to two individuals familiar with the matter. The move comes amid ongoing U.S. export restrictions on high-performance chips destined for China, which limit Nvidia’s ability to supply its most powerful AI accelerators to the region. The H20, designed as a compliant alternative to Nvidia’s top-tier chips, is intended to meet regulatory requirements while still delivering strong performance for data center and AI workloads in China. However, the decision to halt production suggests that Nvidia may be reassessing its strategy in response to shifting trade policies, tightening compliance demands, or evolving market conditions. Foxconn, a key manufacturing partner for Nvidia, is expected to comply with the request as part of its ongoing role in producing and assembling the company’s chips. The suspension does not appear to affect other product lines or manufacturing operations, but it highlights the challenges Nvidia faces in balancing global demand with U.S. government regulations. The company has been navigating a complex landscape, particularly as China continues to invest heavily in domestic AI infrastructure and seeks to reduce reliance on foreign technology.