According to a report from the Nikkei, Chinese technology giants Alibaba, Tencent and ByteDance had placed billions of dollars of orders for NVIDIA's H20 GPUs ahead of the US restrictions on the chips announced earlier this month. The H20 is the latest NVIDIA chip to be sanctioned by the US government, but Nikkei's sources report that Chinese firms had expected the restriction as early as last year and had prepared beforehand. As per one source, the total value of Chinese orders placed with NVIDIA exceeded $12 billion, with billions of dollars of the chips shipped to China before the restrictions cut off supply in April. Chinese Firms Unsurprised By US Restrictions On NVIDIA's H20 AI GPUs Reports of turmoil in the H20 supply chain had started to surface in late March, when a Chinese server company purportedly warned customers of a shortage of the GPUs. This shortage was expected to last beyond April 20, and according to the Nikkei, it might have been the result of over-ordering by major Chinese technology companies including ByteDance, Tencent and Alibaba due to potential US sanctions on the chips. The publication's sources reveal that the three Chinese firms had ordered one million H20 GPUs ahead of US sanctions. Combined with the fact that Chinese tech giant Huawei is believed to be able to produce at least 750,000 of its Ascend A10C AI GPUs, the country has managed to stockpile a large amount of chips before the blanket US sanctions on the products. However, while the Chinese companies did place orders for a million chips, it's unclear whether all of the orders were fulfilled. Image Source: NVIDIA According to the details, Chinese firms have placed more than $12 billion dollars of H20 AI GPU orders since last year, with multiple billions of dollars of orders having been shipped to the country. While the precise figure remains unclear, the sources add that the Trump administration's H20 export license requirements introduced earlier this month meant that Huawei, Tencent and ByteDance's plan of stockpiling a year's worth of AI GPUs fell short. While Chinese firms cannot directly purchase some advanced AI GPUs, they have tried to do so by setting up global subsidiaries to order the chips. Taiwan's leading contract chip manufacturer, the Taiwan Semiconductor Manufacturing Company (TSMC) has confirmed that it is working with the US Commerce Department to trace orders that might have originated from suspicious Chinese entities. The latest orders of H20 GPUs add to the stockpile of advanced chips that Chinese firms have procured. Earlier in the year, it was reported that China's Huawei had managed to source chip dies that could enable it to manufacture as much as 1 million Ascend 910C AI GPUs provided a flawless assembly process. Huawei acquired these dies were acquired before the first Trump administration's sanctions came into effect in September 2020. However, their manufacturing process is significantly behind that of the latest chips manufactured by TSMC, which rely on advanced extreme ultraviolet (EUV) chip manufacturing tools. Deal of the Day