However, according to Reuters, this approval is somewhat limited. The sources said that Samsung's HBM3 chips will only be used in a less advanced Nvidia graphics processing unit (GPU), the H20, which has been developed for the Chinese market to comply with US export controls.

They added that it is not yet clear if Nvidia will use Samsung's HBM3 chips in its other AI processors or if the chips will need to pass more tests first.

Samsung has also not yet met Nvidia's standards for fifth-generation HBM3E chips, and testing of those chips is ongoing, the sources said, declining to be identified as they were not authorised to speak to the media.

HBM is a type of dynamic random access memory (DRAM) first produced in 2013, where chips are stacked vertically to save space and reduce power consumption. It is a key component of GPUs for artificial intelligence, helping to process large amounts of data from complex applications.

Nvidia's approval of Samsung's HBM3 chips comes amid high demand for advanced GPUs due to the generative AI boom, which Nvidia and other AI chipset makers struggle to meet.

There are only three manufacturers of HBM - SK Hynix, Micron, and Samsung - and with HBM3 in short supply, Nvidia is keen for Samsung to meet its standards to diversify its supplier base.

Nvidia's need for more HBM3 is also set to grow as SK Hynix, the leader in the field, plans to increase its HBM3E production and make less HBM3.

Samsung, the world's largest maker of memory chips, has been trying to pass Nvidia's tests for both HBM3 and HBM3E since last year but has struggled due to heat and power consumption issues, Reuters reported in May, citing sources.

Samsung said that claims of failing Nvidia's tests due to heat and power consumption problems were untrue. Samsung could start supplying HBM3 for Nvidia's H20 processor as early as August.

The H20 is the most advanced of three GPUs Nvidia has developed for the Chinese market after the US tightened export restrictions in 2023, aiming to limit supercomputing and AI advancements that could benefit the Chinese military.

In line with US sanctions, the H20's computing power has been significantly reduced compared to the version sold in non-China markets, the H100.

When deliveries began this year, the H20 had a slow start, and the  US firm priced it below a rival chip from Chinese tech giant Huawei, Reuters reported in May. But separate sources have said sales are now growing.