Nvidia (NASDAQ:NVDA) has told some of its suppliers to hit pause on production of the H20, the AI chip it designed specifically for China, The Information reported.
The ripple stretches across big names in its supply chain. Amkor Technology (NASDAQ:AMKR), which handles advanced packaging, was asked to stop work, while Samsung Electronics (SSNLF), a key supplier of high-bandwidth memory, was also told to pause. Foxconn (FXCOF), involved in backend processing, got the same directive.
Nvidia downplayed the move, saying it constantly manages its supply chain to reflect market conditions. The company stressed the H20 isn't a military product or meant for government systems, noting China won't rely on U.S. chips for state usejust as Washington wouldn't turn to Chinese chips for its own agencies.
The pause comes after fresh scrutiny in Beijing. Regulators have reportedly told major players like Tencent, ByteDance, and Alibaba (NYSE:BABA) to suspend H20 orders, flagging national security risks.
For Nvidia, the development underscores just how tricky the China market has becomeeven as demand for its AI chips elsewhere remains red-hot.