What: Nvidia unveils comprehensive European AI strategy including 20 new factories and partnerships with BMW and Mistral AI, responding to $8 billion revenue impact from Chinese market restrictions.

Why it is important: The expansion addresses critical AI computing capacity needs in Europe, potentially democratising access to advanced retail technology solutions.

Nvidia's ambitious European expansion marks a strategic pivot as US export restrictions impact its Chinese operations. The company plans to establish 20 AI factories across Europe, including a German facility equipped with 10,000 GPUs, specifically designed to support manufacturing applications from design to robotics. The partnership with BMW Group exemplifies this focus on industrial innovation, while collaboration with French AI champion Mistral AI, powered by 18,000 chips, aims to create a cloud platform for European businesses. This expansion comes as Nvidia faces significant challenges in China, with recent US restrictions on its H20 chip expected to cost $8 billion in second-quarter revenue. The company's CEO, Jensen Huang, emphasised Europe's awakening to AI infrastructure importance, pledging to increase AI computing capacity tenfold over two years. The presentation also highlighted Nvidia's growing influence in robotics, featuring seven Chinese companies among sixteen robot manufacturers using their platforms.

IADS Notes: Nvidia's European expansion aligns with significant developments in retail technology infrastructure. In February 2025, the EU launched its €200bn InvestAI initiative, while France's AI Action Summit secured €150bn from private investors :cite[c0], creating a supportive environment for AI infrastructure development. This shift comes as global supply chains undergo transformation, with Chinese exports to G-7 economies declining to 30%. The focus on manufacturing innovation mirrors successful implementations like LVMH's AI Factory in July 2024, while Nvidia's Mega platform launch in January 2025 demonstrates growing demand for integrated robotics solutions. The timing is particularly relevant as BCG's January 2025 report shows 67% of executives considering autonomous AI systems, suggesting strong market potential for Nvidia's expanded European presence.

Nvidia bets on European AI push with new plant, partnerships amid shrinking China revenue