AMN-USA News | May 16, 2025

SHANGHAI — U.S. chipmaker Nvidia is planning to open a major research and development (R&D) hub in Shanghai, as it looks to sustain its foothold in China despite tightening U.S. export restrictions on advanced semiconductors.

According to individuals familiar with the matter, Nvidia has evaluated real estate options in Shanghai's Minhang and Xuhui districts since early this year. The move is part of the company’s broader strategy to localize some of its operations, especially as U.S. government policies limit its ability to export high-performance chips like the H20 to China.

Nvidia CEO Jensen Huang reportedly visited China recently and held high-level discussions with senior Chinese officials, including Vice Premier He Lifeng and Shanghai Mayor Gong Zheng. These talks are believed to have further accelerated the company’s regional expansion plans.

In response to U.S. restrictions, Nvidia is preparing to roll out a modified version of its H20 chip that complies with export controls but remains competitive in the Chinese market. That launch is expected within the next two months.

China contributed approximately $17 billion to Nvidia’s annual revenue—about 13% of its global earnings. Shanghai's municipal government has welcomed Nvidia's interest, offering incentives such as land grants and tax benefits to support the R&D project.

CEO Huang has previously warned that being shut out of the Chinese AI market—projected to grow to $50 billion—would be a “tremendous loss” for the company, particularly as domestic competitors like Huawei gain ground.

“China’s AI ecosystem is rapidly advancing. We are committed to supporting innovation while complying with international regulations,” a company spokesperson said.

Source: Reuters