Nvidia’s advanced AI chips valued at over $1 billion were illegally shipped to China within three months of stricter U.S. export controls, the Financial Times reported Thursday.
READ ALSO: Chinese Firms Race to Buy Nvidia AI Chips as Sales Resume
Despite a ban on sales of its high-end B200 processors to China, the chips remain widely accessible on a booming black market, according to the report, which cited sales contracts, corporate filings, and sources with direct knowledge of the transactions.
Nvidia told Reuters that using smuggled products to build data centers is both technically and financially inefficient, as the company only provides service and support for officially authorized hardware.
The U.S. Department of Commerce, the White House, and the Thai government did not immediately respond to requests for comment. Reuters was unable to independently verify the Financial Times report.
According to the report, as of May, several Chinese distributors began supplying B200 chips to data center providers serving Chinese AI companies.
The U.S. and China remain locked in a race for global leadership in AI and other advanced technologies, placing companies like Nvidia in a delicate position as they navigate tensions between the world’s two largest economies.
Last week, Nvidia announced it would be permitted to resume chip sales to China after the Trump administration reversed an export ban on models like the H20, which had been restricted since April.
In the three months leading up to the reversal, Chinese distributors from provinces including Guangdong, Zhejiang, and Anhui reportedly sold Nvidia’s B200 chips along with other restricted processors like the H100 and H200, according to the Financial Times.
Southeast Asian countries have become markets where Chinese groups obtained restricted chips, the report said, citing industry experts.
The U.S. Commerce Department is discussing adding more export controls on advanced AI products to countries such as Thailand as soon as September, the report said.