NVIDIA is developing a new inference‑focused chip for the Chinese market that will use Groq’s language processing units, according to a report by The Information, with the product expected by year‑end and designed to comply with U.S. export restrictions. The United States has imposed export controls that limit the amount of high‑bandwidth memory and advanced packaging that Chinese AI accelerators may receive, prompting Chinese firms such as Semiconductor Manufacturing International Corporation (SMIC) to see increased demand for domestic chip production. SMIC reported a 93.7% utilization rate and revenue of $3.01 billion in the latest quarter, up 36.1% year‑over‑year, while Chinese companies are exploring alternative AI solutions, including Alibaba’s XuanTie C950 RISC‑V processor and DFSX’s DF1000 and DF2000 chips. NVIDIA entered into a licensing and talent‑transfer agreement with Groq in December 2025, granting access to Groq’s LPU architecture, which clusters numerous specialized cores with large SRAM and hard‑wired matrix and vector units, eliminating the need for traditional memory caches and branch predictors. The compiler plans calculations at the nanosecond level to achieve continuous data flow, enabling fast inference. The Information said the new chip will be ready by the end of the year. NVIDIA has stated that it has no LPU sales in China and that the report of such a plan is inaccurate, though the statement focused on current status and left future options open. The development reflects NVIDIA’s effort to maintain a presence in China while adhering to export regulations, and it underscores how export controls are reshaping the domestic semiconductor landscape as SMIC expands its capacity and Chinese firms introduce homegrown AI processors.