Huawei can spark in AI chip industry if China blocks Nvidia H20

Huawei and Nvidia AI chip war is about to take a new turn as China plans to ban the H20 processor. The Chinese government has seemingly deepened the struggle for the US chipmaker following some new energy-efficient rules for data centers.

A report revealed that China could soon introduce new chip performance standards. These regulations assure that AI chips must adhere to green rules and environmental guidelines when used in newly-developed or expanded data centers.

Even though Nvidia is seeking to adapt to these new regulations, that won’t work in all aspects. This is so because, in order to meet the new standards, the chipmaker will reduce the capabilities of its main and current AI processor in China – H20.

If the Nvidia H20 AI chip goes through a power reduction, it will become less attractive for Chinese consumers, unlocking new opportunities for Huawei.

Looks like China wants to push its companies to reduce their dependence on Nvidia in preparation for possible new sanctions coming under the Trump 2.0.

Huawei vs Nvidia

Huawei and Nvidia are the major rivals in the Chinese AI chip race. While the former is constantly pouring efforts to improve its processors, the latter still accounts for a huge market share in China, becoming the forefront of the chip race.

The Chinese tech giant is currently working on its Ascend 910C, which may officially launch this year. It has been used in the DeepSeek R1 AI model and is said to achieve 60% performance of Nvidia H100. (Read the full details HERE)

Many Chinese consumers have started to purchase Ascend chipsets for their AI products and LLMs. But Nvidia still owes several customers in the Chinese market, which becomes a barrier to Huawei’s growth in the respective segment.

If China blocks the way for Nvidia H20, Huawei will get the chance to take over the market with the Ascend 910C AI chip. Perhaps the new regulations seem to be a solution for the progress of Chinese firms in the AI chip battle.

Huawei can spark in AI chip industry if China blocks Nvidia H20 (Image Credits: Huawei/X)