Giga-Byte denies sending servers with restricted Nvidia chips to China

Taipei, April 24 (CNA) Taiwan-based Giga-Byte Technology Co. said Tuesday that it did not ship any servers containing advanced chips produced by U.S. artificial intelligence (AI) chip designer Nvidia Corp., as a report by Reuters alleged.

In a statement, Giga-Byte said that since the United States expanded its ban on the sale of advanced chips to China on Nov. 17, 2023, it has fully complied with Taiwanese rules and international regulations and has not sold embargoed products to China.

The statement was responding to a Reuters report saying that 10 Chinese research institutes and universities had recently obtained Nvidia's most advanced AI chips through resellers despite the U.S.' widened ban on the sale of such technology to China.

A review of hundreds of tender documents of the 10 Chinese entities revealed that they acquired Nvidia-designed chips embedded in server products made by Giga-Byte and U.S.-based Super Micro Computer Inc. and Dell Technologies Inc., the report said.

Citing previously unreported tenders fulfilled between Nov. 20 and Feb. 28, Reuters said the servers, specifically, contained some of Nvidia's most advanced chips.

Reuters said that while the U.S. has blocked Nvidia and its partners from selling advanced chips to China, including through a third party, the sale and purchase of the chips are not illegal in China.

The resellers in China were little known retailers, Reuters said, and it acknowledged that it could not determine whether they used stockpiles acquired before U.S. restrictions were tightened in November to fill the orders.

An industry source told CNA that Nvidia's partners have been under close scrutiny and banned from shipping products under the sanctions to China since the stronger restrictions took effect on Nov. 17.

The source said, however, that as long as Chinese distributors imported Nvidia's advanced chips to China before the expanded ban took effect on Nov. 17, the transactions were legal, and the distributors were still allowed to resell these chips in China after the date.

The source contended that the tender documents the report obtained failed to provide sufficient evidence for the allegations.

Gita-Byte and Nvidia have built a close business partnership.

In August 2023, Giga-Byte became one of the first partners of Nvidia to launch the advanced OVX server, which contained the U.S. chip designer's L40S graphics processing unit (GPU).

In March, Giga-Byte was again named one of the partners in Nvidia's GPU technology conference (GTC) in San Jose, California, where the U.S. tech giant introduced the latest flagship AI chip Blackwell B200.

The company, a leading graphics card and motherboard vendor for AI applications, has seized on the opportunities created by a global boom in AI development by rolling out AI servers.

In 2023, it posted record consolidated sales of NT$136.77 billion (US$4.20 billion), up 27.51 percent from a year earlier.

According to Giga-Byte, AI servers have accounted for more than 30 percent of its total sales, and it expected revenue from AI servers to continue growing in 2024.