Nvidia works to meet strong H200 demand from Chinese tech companies

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It's Christina Partzan

Christina Partsinivelos (?) 00:01.480

There could be a button. I'll get to that in a second. So, Okay Nvidia's China business just got a major green light and the numbers are enormous. Reuters reports Chinese tech companies have ordered more than 2 million of Nvidia's H200 chips for next year, roughly $27,000 per

Christina Partsinivelos (?) 00:16.120

chip. That's according to them. So, that would equate to roughly 50, you know, 54 billion dollars in potential demand. Nvidia currently has about 700,000 chips available, meaning the company will need TSMC Taiwan Semiconductor to ramp up production starting very very soon.

Christina Partsinivelos (?) 00:31.960

ByteDance alone, which is the parent of TikTok, is reportedly planning to spend $14 billion dollars on Nvidia chips in 2026. So, that could equate to roughly 10% of Nvidia's annual revenue and this estimated from just one single customer. ByteDance has already built a

Christina Partsinivelos (?) 00:47.920

1,000-person chip team and developed a chip comparable to Nvidia's 820 chip, which is a lower tier chip geared toward China at a lower cost. But the scale of these orders today shows China still doesn't have domestically produced chip capabilities or chips capable of handling

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large-scale AI training at Nvidia's level, which is good news for Nvidia. There's also a US revenue angle. Nvidia pays or supposed to pay a 25% fee to the US government on China sales. That means roughly $3.5 billion from ByteDance alone if we take those numbers at face value,

Christina Partsinivelos (?) 01:22.080

potentially more than 13 billion of all 2 million chips ship. For investors, this matters because China revenue has been stripped out out of street models. These approvals could drive upward revisions, but the stock isn't celebrating today. Investors have lived through repeated

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starts and stops and big butts on China chip sales. Until orders turn into shipments and revenue, the market is just taking a wait-and-see approach. There's the the butt for you.