Chipmakers have pushed the Trump administration bailout from export controls that are hindering their ability to sell to customers in Asia
[HONG KONG] China's cyberspace regulator has directed companies, including Alibaba Group Holding, to suspend orders for Nvidia's RTX Pro 6000D.
China's Cyberspace Management told businesses this week to stop testing chips and cancel existing orders. Some companies had shown that they would buy tens of thousands of semiconductors before the directive. It was designed to avoid the triggering of US restrictions on sales of advanced AI chips to China, Nvidia designed it to avoid restrictions on US sales to China. Financial Times (ft).
Nvidia is responsible for a 2.7% slide in US trading, but its rival advanced microdevice stock fell nearly 1%.
The move will separate Beijing's latest steps from Nvidia hardware and boost domestic alternatives, but China is also protesting US export curbs that have effectively banned the purchase of the best foreign chips and manufacturing tools. These restrictions covering a variety of products beyond Nvidia's processors were central themes of the ongoing trade talks between Washington and Beijing.
The White House, preparing Friday's call between President Donald Trump and Chinese President Xi Jinping, did not comment on China's Nvidia's move. The talks between the two leaders are already expected to touch on a variety of controversial issues, including a new contract to run Tiktok in the US.
A spokesperson for Alibaba in Washington and the Chinese Embassy did not immediately respond to requests for comment.
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Meanwhile, Nvidia CEO Jensen Huang expressed his frustration with the RTX Pro 6000D limit.
“I'm disappointed with what I'm seeing, but they have a bigger agenda to work out between China and the US,” Huang told reporters at a UK press conference. “We can only serve the market if our country wants us.”
Nvidia controls the market for chips, essential for building and operating AI services in companies such as the Openai and Meta platforms, and Chinese companies are eager to hardware despite advances in domestic alternatives. Chipmakers have pushed the Trump administration bailout from export controls that have hindered their ability to sell to customers in Asian countries.
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These restrictions, dating back to 2022, were designed to prevent China from accessing advanced AI that can lend Beijing to military ties. Washington has increased control several times, urging Nvidia to design a new chip for China that adheres to US thresholds.
This includes the RTX Pro 6000D, part of a product series that is not considered one of Nvidia's Marquee products. The chip is for workstations that can handle graphic design or product development, but can be reused for use in AI data centers, and offers performance compromises.
There is also a server version of the RTX Pro 6000D aimed at deployment in small corporate data rooms, rather than a large array with stronger versions of Blackwell chips being designed. Neither market is a major source of revenue for Nvidia, but Beijing's actions further narrow the choices of Chinese customers.
Nvidia also offers its Chinese customers with chips specifically designed to handle AI workloads (H20). Its accelerator, which debuted last year, is less powerful than NVIDIA's top AI processors, but is particularly suited for AI inference, where the model recognizes patterns and draws conclusions. Trump officials restricted sales of the H20 to China in April, but later approved a license to sell these processors in exchange for a 15% reduction in revenue.
However, Nvidia quickly regained Washington before Beijing expressed opposition. Chinese authorities have discouraged businesses from using H20 chips. This is guidance that didn't lead to a complete ban, but still had a calm effect. Nvidia has not performed these shipments despite receiving Washington's official green light for several H20 exports, the company said last week.
Nvidia's Chinese client said, “We want to make sure that the Chinese government has been very well received in terms of receiving H20 to them. “But I believe there is a strong chance that this could happen.”
Still, Beijing continues to take the assertive tack. This week, China ruled that Nvidia violated anti-titan law with its US$7 billion acquisition of Mellanox Technologies' US$2020 US$2020, limiting pressure on US$. A few days ago, Beijing also said it had begun anti-dumping investigations on a type of semiconductor created by US companies such as Texas Instruments.
“China clearly prefers to develop AI at its own pace with its domestic technology stack. It's better to bite a bullet now than to rely on US technology that can be restricted to whim,” said Vey-Sern Ling, managing director of Union Van Sale Prive. But while Beijing's latest move is a show of confidence in the local supply chain, he added that “it is likely to be a tip for negotiating trade negotiations.”
Beijing's regulators have made a recent decision as there is a growing sense of domestic chips being refined, the FT reported Wednesday, citing sources familiar with the issue.
Huawei Technologies is leading the development of AI chips for the domestic market, but startups such as Cambricon Technologies are also making progress. Companies like Alibaba and Baidu want to reduce their dependence on foreign chips and are developing their own homemade alternatives.
Alibaba has secured well-known customers for the “T-Head” AI chip with China's No. 2 wireless carrier, suggesting that the early semiconductor efforts of Chinese technology leaders are gaining attention in the home market. Bloomberg
