Nvidia plans Shanghai Research Center in a new commitment to China

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Nvidia seeks to build a Shanghai Research and Development Center to help the leading manufacturer of artificial intelligence processors in the world to remain competitive in China, where its sales have been reduced due to the constipation of US export controls.

CEO Jensen Huang discussed the plan with Shanghai Mayor Gong Zheng when they met in the Chinese city last month, according to two people who are aware of the matter. Nvidia is leasing a new office space in Shanghai to house existing employees, as well as a possible expansion.

Depending on people aware of the plans, the R&D center would investigate the specific demands of Chinese clients and the complex technical requirements needed to satisfy Washington sidewalks.

Real basic design and production will remain abroad due to legal sensitivity to intellectual property transfer to China. Nvidia said: “We do not send any GPU designs to China to be modified to fulfill export controls.”

The Shanghai team would also work on global R&D projects, including verification of chips, optimization of existing products and the research of the focus of the sector, such as autonomous driving, people with knowledge of the matter said.

Huang also wants to ensure access to the higher artificial intelligence talent based in China. Nvidia is currently publishing Shanghai -based functions, including engineers to help “guide the development of deep -generation deep hardware and software” and “develop and optimize ASIC designs that compete on a global scale”.

The Shanghai government had shown preliminary support for these plans, while Nvidia He pressed the United States administration for approval, said one of the people. The Silicon Valley company has about 2,000 employees in the Chinese city, mainly in related sales and support functions.

Nvidia is expanding her research footprint in China, as she seeks to maintain a leading position in one of her largest markets abroad, where she fears that local competitors run by Huawei can take on a rival Ai ecosystem.

Although China represented about 14 percent of Nvidia’s income last year, at about $ 17 million, Huang has estimated that it could be a $ 50 million market in a couple of years.

“We want to build the AI ​​of the world (where) North -American standards adopt all over the world,” Huang said last week at a Milken Institute event. “If we leave a market at all, there is no question that someone intervenes. Huawei, for example, is very formidable … they will come in.”

The Trump administration published a warning this week in North -American and Foreign Companies around the world than Use of AI chips made by Huawei It could trigger criminal sanctions to violate the US export controls.

Huang He flew to Beijing To meet the Chinese Deputy Pupremier, Lifeng on April 17, days after new export restrictions were imposed on NVIDIA H20 chip, a small model that had already been redesigned to fulfill the controls of the Biden era that limited sales in China.

Given the restrictions on the best -selling chips in China, NVIDIA offers L20 processors (low range chips without a large bandwidth memory and with less computer power) to Chinese clients as an alternative, according to people with knowledge of the matter.

It is understood that technological giants do not hesitate to order because processors cannot compete with rival Chinese products in performance.

“We are in an uncomfortable situation where we choose a worse nvidia chip that runs (its software system) Cuda, which means a lower operational cost or we move to Chinese chips and live through switching system pain,” said a leading Chinese technology firm executive.

Clients led by Bytedance, Alibaba and Tincent follow geopolitical developments to evaluate if NVIDIA could offer a high -raised high -range chip to meet their needs. While Nvidia explored several options, there were no plans completed due to legal uncertainty, according to people.