Chinese companies are rushing to acquire Nvidia’s H20 artificial intelligence chips, two sources told Reuters, as the company announced plans to restart sales to mainland China just days after its CEO met with U.S. President Donald Trump.
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Nvidia’s AI chips have been central to U.S. export restrictions aimed at preventing China from accessing cutting-edge technology due to national security concerns. The U.S.-listed firm has stated that the curbs could reduce its revenue by $15 billion.
Nvidia, the world’s most valuable company, said it is filing applications with the U.S. government to resume sales of its H20 graphics processing unit (GPU) to China and expects to receive the necessary licenses soon.
“The U.S. government has assured Nvidia that the licenses will be granted, and the company hopes to begin shipments shortly,” Nvidia said in a statement, noting that CEO Jensen Huang is currently in Beijing.
According to sources familiar with the matter, Chinese firms have rushed to place orders for the chips, which must be submitted to U.S. authorities for approval. They also noted that major internet companies, including ByteDance and Tencent, are in the process of filing their applications.
A key part of the process involves a “whitelist” created by Nvidia, which enables Chinese companies to register for potential purchases, one source revealed.
ByteDance and Tencent did not respond to requests for comment, while Nvidia also declined to comment specifically on the “whitelist.”
Nvidia, which has voiced criticism of the export restrictions imposed by the Trump administration in April restrictions that blocked the sale of its H20 chip in China also stated that it has developed a new model designed to comply with regulatory requirements in the Chinese market.
The White House did not immediately respond to a request for comment.
U.S. officials have raised concerns that China’s military could leverage AI chips to advance weapons development.
Nvidia CEO Jensen Huang is set to hold a press briefing in Beijing on Wednesday during his visit to a supply chain expo. Huang, who also traveled to China in April, has emphasized the significance of the Chinese market.
“The Chinese market is vast, dynamic, and highly innovative. It’s also home to many leading AI researchers,” Huang said in an interview with Chinese state broadcaster CCTV on Tuesday.
“Therefore, it’s essential for American companies to establish a strong presence in the Chinese market,” Huang added.
Nvidia’s Frankfurt-listed shares rose 3.2% following the news. Reports about the resumption of chip sales to China also gave a boost to cloud computing and 5G communications stocks.
SUPPLY CHAIN
Nvidia is facing growing competition from Chinese tech giant Huawei and other GPU manufacturers—key components used to train AI models. However, many Chinese firms, including major tech players, continue to seek out Nvidia chips, largely due to the company’s powerful computing platform, CUDA.
Huang’s visit is drawing significant attention in both China and the United States. Just last week, a bipartisan group of U.S. senators sent a letter urging the Nvidia CEO to avoid engaging with Chinese companies linked to military or intelligence operations, as well as those listed on the U.S. export restriction list.
Nvidia’s decision to resume H20 chip sales comes as tensions between Washington and Beijing show signs of easing. Recent developments include China loosening restrictions on rare earth exports and the U.S. allowing the reinstatement of chip design software services in China.
“Despite the temporary reprieve in the H20 ban, the broader uncertainty in U.S.-China relations remains high. Chinese companies are expected to continue diversifying their supply chains to reduce reliance on any single source,” said He Hui, semiconductor research director at Omdia.
The H20 chip was custom-built for the Chinese market following U.S. export controls imposed in late 2023 over national security concerns. It was Nvidia’s most advanced chip legally available in China until Washington effectively barred its sale in April.
The ban resulted in Nvidia writing off $5.5 billion worth of inventory. Huang previously disclosed in an interview with the Stratechery podcast that the company had to forgo $15 billion in potential sales due to the restrictions.
In response, Nvidia introduced a new AI chip for China the RTX Pro GPU designed to comply fully with U.S. export regulations. The chip is targeted at digital twin AI applications in sectors like smart manufacturing and logistics.
In May, Reuters reported that Nvidia was preparing to release the RTX Pro 6000D, a more affordable AI chip for the Chinese market. Based on the latest Blackwell architecture, the chip is expected to be significantly less expensive than the H20 due to lower performance specs and simpler production processes.
China remains a vital market for Nvidia, generating $17 billion in revenue in the fiscal year ending January 26 representing 13% of the company’s total sales. Huang has consistently emphasized China’s importance to Nvidia’s long-term growth strategy.