Nvidia’s H200 component suppliers have reportedly suspended production after Chinese customs authorities blocked imports of newly approved artificial intelligence processors into China.
Reuters could not immediately confirm the report in the Financial Times, citing two people familiar with the matter. Nvidia did not immediately respond to a Reuters request for comment outside normal business hours.
Nvidia expects to receive more than 1 million orders from Chinese customers, the report said, adding that its suppliers were working around the clock to prepare shipments as of March.
According to Reuters, Chinese customs officials this week informed customs officials that Nvidia’s H200 chips were not allowed into the country.
Sources also said government officials have summoned domestic tech companies and warned them not to buy chips unless necessary.
The officials, who spoke on condition of anonymity due to the sensitivity of the matter, said authorities had not given any reason for the order or whether it was a formal ban or a temporary measure.
Nvidia’s second most powerful AI chip, the H200, is one of the biggest flashpoints in US-China relations. There is strong demand from Chinese companies, but it remains unclear whether the Chinese government wants to ban the chip completely to encourage domestic chip companies to develop their own chips. Whether the Chinese government is still considering restrictions. Or if it’s all a negotiation tactic.
If the import ban is confirmed, it would further complicate the situation, with the Trump administration allowing the export of the U.S.-designed, Taiwanese-made H200 chip to China, with the U.S. government receiving a cut of the profits.
The U.S. government then decided that instead of sending the finished chips directly from Taiwan to China, they would first be tested in U.S. laboratories, allowing them to be subject to a 25% tariff as they pass through the United States. The tariffs also applied to chipmaker AMD’s MI325X processors.
Experts and analysts are divided on whether selling the H200 to China is a strategically good idea. Proponents argue that its availability could slow China’s progress in developing similar chips and keep Chinese companies dependent on U.S. technology. Opponents argue that the H200, for example, is powerful enough to be used in weapons systems that the Chinese military could one day deploy against the United States and its allies.
Reuters
