Nvidia’s China-bound H20 AI chips face Beijing scrutiny over ‘tracking’ and security concerns

While Nvidia has been fixed assurances by Washington that it volition beryllium allowed to resume exports of its made-for-China H20 wide processing units, the AI chips' instrumentality whitethorn beryllium met with accrued scrutiny from Beijing.

According to the Cyberspace Administration of China, Nvidia met with Beijing officials connected Thursday regarding nationalist information concerns posed by the H20 chips, which are expected to resume shipments to China pursuing an effective ban successful April.

Nvidia was requested "to clarify and taxable applicable supporting documentation regarding information risks, including imaginable vulnerabilities and backdoors, associated with its H20 computing chips sold to China," according to a CNBC translation of a connection from CAC. 

In a post, the regulator said that Nvidia's AI chips person been reported to incorporate superior information vulnerabilities. It besides noted calls from U.S. lawmakers for mandatory tracking features to beryllium placed connected precocious spot exports. 

CAC added that American AI experts had already revealed that Nvidia's computing chips airs mature "tracking and positioning" and "remote shutdown" technologies.

In May, Republican U.S. Senator Tom Cotton and a bipartisan radical of 8 Representatives introduced the U.S. Chip Security Act that would necessitate semiconductor companies similar Nvidia to include security mechanisms and determination verification successful their precocious AI chips.

Democratic Representative Bill Foster, who was 1 of the co-leads of the measure successful the House, and autarkic method experts told Reuters successful May that the exertion to way chips was readily available, with overmuch of it already built into Nvidia's chips.

Nvidia did not instantly respond to a petition for remark from CNBC. 

In caller weeks, galore American lawmakers person besides pushed backmost against the reported rollback of restrictions connected Nvidia's H20 chips, informing they volition beforehand Beijing's AI capability.

Increased scrutiny from Beijing could present yet different geopolitical headwind for Nvidia CEO Jensen Huang, who has been balancing betwixt Washington's semiconductor policies and his tendency to merchantability to the lucrative China market. 

Huang had announced the expected resumption of H20 spot income during his latest sojourn to Beijing — a travel that came soon aft helium met with U.S. President Donald Trump. 

Nvidia had taken a $4.5 cardinal writedown connected the unsold H20 inventory successful May and said income successful its past fiscal 4th would person been $2.5 cardinal higher without immoderate export curbs.

This week, Nvidia reportedly placed orders for 300,000 H20 chipsets with declaration manufacturer TSMC as it seeks to conscionable Chinese demand.