JPMorgan has reported that NVIDIA (NVDA, Financial) has received approval from the U.S. government to sell its H20 GPUs to Chinese customers and announced the release of a professional version of RTX tailored for the Chinese market. This development is expected to positively impact global AI hardware demand and further tighten the GPU supply situation.
In China, AI data center hosting companies like GDS Holdings (GDS), 21Vianet Group (VNET), and others are likely to benefit. However, leading domestic semiconductor supply chain companies such as Semiconductor Manufacturing International Corporation (SMIC) could face negative market sentiment due to the competitive pressure.
The report highlights that hardware suppliers such as Amkor Technology (AMKR), SK hynix, Huaqin Technology, and Inventec have significant exposure to NVIDIA's H20 GPUs. Overall, this move might lead to an upward revision of TSMC's (TSM) CoWoS production estimates, which had been previously adjusted downward following H20 restrictions earlier this year.
JPMorgan believes that after the launch of DeepSeek R1, H20 demand could rebound significantly if NVIDIA secures sales permission to most Chinese cloud service providers.
