Nvidia deepens Japan robotics push while cutting Asian chip distributors

Nvidia (NASDAQ: NVDA) has announced that ten of Japan’s largest industrial names, including FANUC, Fujitsu, Sony Group and SoftBank Corp., plan to build robots and factory systems on its physical AI software. 

This announcement comes in spite of the fact that Nvidia is halving its approved distributor list across Asia to keep advanced GPUs out of China.

The Nikkei 225 fell briefly by more than 3% on July 16 before closing down 2.79%, pulled lower by semiconductor stocks.

Why is Nvidia focusing on Japan? 

Nvidia (NASDAQ: NVDA) has announced major partnerships with top Japanese robotics and manufacturing firms like FANUC (TYO: 6954), Fujitsu, SoftBank (TYO: 9984), and Kawasaki Heavy. These companies are building their systems on Nvidia’s Cosmos physical AI platform. 

As of May, Nvidia’s combined robotics and automotive unit recorded $567 million in quarterly sales, which was up 72% from the previous year. But the company’s robotics division only represents about 1% of its revenue. 

Nvidia’s CEO Jensen Huang believes the “next frontier of AI is in the physical world” and that this expansion into the country is a “once-in-a-generation opportunity for Japan.” Cryptopolitan previously reported that the company’s interest in Japan is due to its strengths in factory automation and precision engineering

The centerpiece of this Japanese expansion is the new Cosmos 3 Edge, a 4-billion-parameter model that runs directly on Nvidia’s Jetson edge computers, particularly the newly announced Jetson T2000 and T3000 modules. It allows robots to understand their surroundings and make decisions on the spot without needing to connect to the cloud. Developers can adapt the model to a specific robot or sensor setup in about a day. 

A major part of the plan is the expansion of the Cosmos Coalition to Japan. Over 20 of Japan’s biggest industrial names have said they plan to join. This includes companies like Hitachi, Kubota, NEC, and Yaskawa Electric.

Fujitsu is leading an effort with FANUC, Yaskawa, and Kawasaki Heavy to build a shared control platform for industrial robots. Other companies are focusing on more targeted solutions like Kubota, which is looking at using this technology for autonomous farming. 

GROOVE X is building companion robots powered by the Jetson system, while Enatic is working on semi-humanoid robots designed to help care for the elderly. In shipbuilding, Kawasaki Heavy and Nvidia will develop an AI-driven shipyard using digital-twin technology to help fix Japan’s shortage of skilled labor. 

However, while 22 companies were named as intending to join the Cosmos Coalition, this is only an expression of intent, and no binding commitments or money have been mentioned. 

How are U.S. export controls affecting Nvidia’s business in Asia?

While it furthers its robotics ambitions in Japan, Nvidia is simultaneously tightening control over who can buy its chips in the rest of Asia. The company has cut its approved Asian distributor list by more than half and imposed stricter vetting rules in key countries like Japan, Singapore, and Malaysia. Cryptopolitan reported that this new, tougher process has already locked out more than 50% of previous buyers. 

The process now includes on-site data center audits, client contract verification, and user interviews, with the U.S. Department of Commerce providing oversight.

This crackdown is a direct response to pressure from Washington to stop Nvidia’s high-end chips from being smuggled into China. In March, a co-founder of Super Micro Computer (NASDAQ: SMCI) was indicted over an alleged $2.5 billion scheme to smuggle Nvidia chips to China through a Southeast Asian intermediary.  

CEO Jensen Huang told investors in May that Nvidia has “largely conceded” the Chinese market to its rival, Huawei. 

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