The Americans give in: Nvidia is allowed to sell advanced H200 chips for AI to Chinese firms

Nvidia CEO Jason Huang, who was not initially on the list of White House delegation members, joined the trip to Beijing at the invitation of US President Donald Trump, the unnamed source said. He joined the US delegation traveling to a summit with Chinese President Xi Jinping in Alaska, raising hopes that the visit could finally pave the way for sales of the H200 in China.

Before the US tightened export restrictions, Nvidia’s share of the Chinese market for advanced chips was around 95 percent. China’s share of the company’s revenue was at one time 13 percent, and Huang previously estimated that the market for artificial intelligence chips in China alone would be worth $50 billion this year.

The US Department of Commerce has granted licenses to buy Nvidia’s H200 chips to about 10 Chinese companies, including Alibaba, Tencet, ByteDance and JD.com, unnamed sources told Reuters on condition of anonymity because of the sensitivity of the matter.

Approval has also been issued to a handful of distributors, including Lenovo and Foxconn. Customers are allowed to buy directly from Nvidia or from listed intermediaries, and each licensed customer can purchase up to 75,000 chips under the terms of the US licenses, two sources said.

A spokeswoman for the US Treasury Department, which oversees export controls such as those for the H200, declined to comment to Reuters on the situation. China’s Ministry of Industry and Information Technology and the National Development and Reform Commission did not respond to Reuters’ request for comment. In a statement to Reuters, Lenovo confirmed that the company is “one of the few companies that have received permission to sell the H200 chip in China under Nvidia’s export license.” Nvidia, Alibaba, Tencent, ByteDance, JD.com and Foxconn did not respond to Reuters’ request for comment.

So far no deliveries

Huang told Chinese state television CCTV on Thursday that he hoped Trump and Xi would further build on their good relationship during talks in Beijing to improve bilateral ties.

Despite US approval, the deals were not agreed because Chinese companies backed out after instructions from Beijing, one source said. The Chinese government is hesitant to issue permits for the purchase, fearing that imports could undermine efforts to develop domestic artificial intelligence chips. Although China’s AI chips are still lagging behind Nvidia’s, companies like DeepSeek are increasingly touting their use of domestic chips, including those developed by Huawei.

The turn toward Huawei underscores Nvidia’s uncertain position in China. Huang warned that US export controls are eroding Nvidia’s foothold in the Chinese market, noting that the company’s market share in China’s AI processor market has practically been reduced to nothing.

Sensitive conditions

The road to concluding the sale of that valuable product was crossed by a series of requests from both sides. A US regulation published in January requires Chinese buyers to prove that they have implemented “adequate security procedures” and that they will not use the chips for military purposes. Nvidia, on the other hand, must confirm that its supplies in the US are sufficient. Trump reached an agreement with that company according to which the US will receive 25 percent of the revenue from the sale of IPs in China.

In China, too, controls have been tightened after the State Council issued two new regulations on supply chain security, spurring government efforts to find and eliminate potential dependencies on foreign suppliers in strategic technology infrastructure, a fourth source told Reuters.

The continued delay has been welcomed by hardliners in Washington, who reject claims by the Trump administration that exporting advanced chips to China will prevent Chinese competitors from approaching American chip designers.

“Any deal that allows Nvidia to sell more chips in China means fewer Nvidia chips for U.S. companies and reduces the U.S. advantage over China in the AI sector,” said Chris McGuire, head of China and emerging technologies at the U.S.-based think tank the Council. for Foreign Affairs (CFR). “It’s incredible that someone keeps persuading President Trump to put Nvidia’s interests ahead of America’s,” McGuire said.