Huawei's Ascend 910C AI Chip to Rival Nvidia H100

According to an exclusive report by The Wall Street Journal, Huawei, a leading Chinese technology firm, is currently testing its latest AI accelerator, the Ascend 910C. The company has indicated to potential clients that this new chip could rival Nvidia's H100 GPU, which is not available for direct sale in China.

Sources reveal that ByteDance, the parent company of TikTok, Baidu, a major search engine provider, and China Mobile, a prominent telecommunications operator, are in early discussions regarding the acquisition of the Ascend 910C. Preliminary agreements suggest that orders could exceed 70,000 units, amounting to approximately $2 billion. Huawei expects to begin shipments as early as October.

Dylan Patel, an analyst at SemiAnalysis, anticipates that the Ascend 910C will outperform Nvidia's planned downgraded B20 variant for the Chinese market. Should Huawei successfully produce the Ascend 910C and Nvidia continue to face restrictions on supplying advanced products to Chinese customers, Nvidia's market share in China could experience a significant decline.

However, Huawei's production of the new chip is currently facing challenges, including delays and yield issues. Furthermore, anticipated U.S. sanctions at the end of August may hinder Huawei's access to essential production equipment and HBM memory required for the Ascend 910C.

Despite these developments, Nvidia's stock remained strong. On August 13, Nvidia's share price increased by 6.53%, reaching $116.14 and achieving a new closing high since July 31. The stock is still 17.5% below its peak of $140.76 reached on June 20.

Nvidia is scheduled to announce its Q2 (May-July) financial results on August 28. Analysts surveyed by FactSet project an EPS of $0.64 and revenue of $28.6 billion for the quarter.

Barron's reported on August 13 that UBS analyst Timothy Arcuri forecasts Nvidia's revenue for August-October could reach $31.7 billion. Arcuri's analysis highlights that while Nvidia's financial projections are important, the focus for investors remains on the anticipated 2025 Blackwell chip production plans.

Even with potential delays of the B200 chip, Nvidia's revenue is expected to remain robust due to continued strong demand for the Hopper series GPUs. The H100 is nearing a balance in supply and demand, and the more advanced H200 still has substantial backlog orders. Nvidia's strategy to increase shipments of Hopper GPUs remains on track.