NVIDIA Reportedly Adds 300K H20 Chip Orders to TSMC

According to sources cited by Reuters, NVIDIA has placed an order for 300,000 H20 chipsets with TSMC, its wafer foundry partner. One insider noted that strong demand from the Chinese market has prompted the US tech giant to rethink its earlier stance and move beyond relying solely on existing inventory.

This shift comes after the US government recently lifted restrictions on NVIDIA's H20 chips, allowing the company to resume sales to China. Earlier this year, when the H20 was banned in April, NVIDIA canceled some customer orders and halted previously booked production capacity at TSMC. As a result, TSMC redirected that manufacturing capacity to produce chips for other clients.

Restarting H20 production from scratch at TSMC is expected to take about nine months. Meanwhile, industry reports indicate that around one million H20 chips remain in inventory within Taiwan's semiconductor supply chain, including approximately 700,000 finished chips.

Currently, NVIDIA may be selling from this existing stockpile without immediate plans to ramp up new H20 production. A report from The Information also suggested that NVIDIA might not restart H20 manufacturing soon.

However, the latest updates show that strong Chinese market demand appears to be pushing NVIDIA to increase H20 production capacity after all, signaling a significant shift in its earlier strategy.