Nvidia CEO says China’s AI chips are just a “few nanoseconds” behind the U.S.

Nvidia CEO, president and co-founder Jensen Huang has a serious warning for U.S. chipmakers. When it comes to AI chips, China is just “a few nanoseconds” behind the U.S. Huang states, a proclamation that can’t make companies including AMD and his own Nvidia feel good. Like the U.S., China has been looking to become self-sufficient when it comes to chips. However, unlike the U.S., China faces sanctions from the U.S. which makes it hard for China’s foundries to obtain much needed equipment such as cutting-edge lithography machines which make the production of chips under 5nm possible.

Huawei’s AI accelerator chips have the top market share in China 

Chinese tech companies are believed to favor Nvidia’s computing platform, known as CUDA (Compute Unified Device Architecture). CUDA allows developers to take advantage of the parallel processing used by Nvidia’s GPUs to process large amounts of data at one time. With AI, billions and trillions of operations are taking place at the same time. Chinese firms Baidu, Tencent, and Alibaba are rallying around a CUDA-free ecosystem. Nvidia’s Huang suggests open competition and worries that reigning in China will lead to an economic whiplash for the U.S.

20%-25% of Nvidia’s datacenter revenue came from China

China benefits from state funding of semiconductor companies, a large pool of talent, and demand from Baidu, Alibaba, Tencent, and ByteDance. These advantages make up for some of the sanctions that the U.S. has placed on Chinese chip production.

Nvidia says that 20%-25% of its revenue from datacenters came from China. However, before the U.S. changed its mind allowing Nvidia to sell some chips in China, there is concern that China is moving to domestic alternatives for AI accelerators as U.S. suppliers like Nvidia are still banned from selling their best performing chips to China.

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