Nvidia's chip sales to China at risk of 'going to zero' on Beijing policy: Analyst

Core Insights - Nvidia and other American AI chip makers see a window of opportunity to sell into the Chinese market amid the AI revolution, but future sales are uncertain due to China's self-sufficiency goals [2][4][6] - China's semiconductor self-sufficiency plan has been in development since 2015, indicating a long-term strategy to reduce reliance on foreign technology [1][6] - Current projections suggest that Nvidia's sales to China could potentially drop to zero if China prioritizes chip self-sufficiency over raw computing power [2][5] Industry Dynamics - The narrative around US-China semiconductor relations is evolving, with some observers noting that US restrictions are less stringent than in the past, particularly compared to the sanctions imposed on Huawei [3][6] - Chinese companies like Huawei and Cambercon are developing alternatives for AI chips, but they currently lag in performance and production volume due to US restrictions on equipment sales [4][5] - The technological gap between US and Chinese semiconductor manufacturing is significant, with US companies like TSMC maintaining superior yield and sophistication compared to China's SMIC [5][6] Policy Implications - Policymakers recognize that US restrictions on chip sales to China are not permanent obstacles, as China is committed to achieving self-sufficiency and advancing in semiconductor technology [6][7] - The call to action for the US and its allies is to innovate and adopt AI technologies more rapidly to maintain a competitive edge [6][7]