China’s major internet companies, including ByteDance, Alibaba (HK:9988), and Tencent (HK:0700), stockpiled billions of dollars worth of Nvidia’s (NASDAQ:NVDA) H20 artificial intelligence (AI) chips ahead of U.S. restrictions on their export, Nikkei Asia reported on Wednesday citing sources.

The three companies rushed to secure around one million H20 chips — nearly a full year’s supply — in anticipation of the U.S. cutting off shipments in April, the Nikkei report said.

These chips, specifically designed to comply with U.S. export controls, are vital for AI applications, particularly inference tasks.

ByteDance, one of the most aggressive buyers, and other firms reportedly placed rush orders worth over $12 billion, with several billion dollars’ worth shipped before the new restrictions took effect earlier this month, according to the report.

The H20 is a downgraded version of Nvidia’s H100 chip, popular in China due to its lower power requirements compared to the original model.

Earlier this month, Nvidia said it would take a $5.5 billion hit in the first quarter due to the new restrictions.

With the new curbs, Chinese firms are looking at alternatives like Huawei’s Ascend chips and exploring ways to bypass the export restrictions, including setting up overseas subsidiaries, Nikkei reported.

The stockpiling comes amid surging demand for AI computing power in China, fueled by the rise of applications like DeepSeek integrated into Tencent’s WeChat.