Nvidia shares dip on WSJ report that China’s Huawei is testing new AI chip

Investing.com-- Huawei Technologies is preparing to test its most advanced artificial intelligence processor yet, in a move that could help the Chinese tech giant replace some of Nvidia’s (NASDAQ:NVDA) higher-end products, the Wall Street Journal reported on Sunday, citing people familiar with the matter.

The new chip, known as the Ascend 910D, is expected to arrive in sample batches by late May, the report said.

Nvidia shares fell nearly 1% in pre-market trade Monday.

Huawei has approached Chinese tech firms to test the chip’s feasibility, aiming to create a domestic alternative to Nvidia’s powerful H100 chip, widely used for AI development, the WSJ report stated.

Despite facing U.S. trade restrictions for nearly six years, Huawei has advanced its semiconductor capabilities, notably with the Mate 60 smartphone released in 2023.

The company’s push into AI hardware comes amid tightening U.S. export controls that have limited Nvidia’s sales in China.

Earlier this month, Washington placed Nvidia’s H20 chip—the most advanced it could sell in China without a license—on its restricted export list. Nvidia said the move would lead to a $5.5 billion charge in the first quarter.

Huawei is also ramping up shipments of its earlier AI chips, the 910B and 910C, and has begun building large-scale computing systems to maximize their performance, according to the WSJ report.

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