China Plans to Allow Top AI Firms Limited Purchase of Nvidia H200 Chips
Taylor Wilson
Beijing is preparing to let Alibaba, ByteDance, and DeepSeek buy fewer than 200,000 Nvidia H200 chips — for training only — in a tightly controlled move that balances an acute compute shortage against its drive for chip self-reliance.
How many chips, and is it enough?
Sources say the total will be under 200,000 — less than half of what the companies requested earlier this year. This means → Beijing is offering a thirst-quencher, not a full supply.
Final approval has not landed; both the number and the timeline could still shift.
In plain terms = the door is cracking open, but how wide and when — nobody knows yet.
What can the chips be used for — and what's off-limits?
H200s may be used only for model training, and only on public data — no sensitive user information allowed.
For inference — the stage where a trained model actually serves users — companies must switch to Chinese-made chips. Beijing considers domestic processors already competitive here.
This reflects a dual calculation: import advanced chips to relieve the training bottleneck, but keep inference on home-grown silicon to protect domestic industry.
The US cleared these sales months ago — why the delay?
Trump approved Nvidia's export of H200s to vetted Chinese buyers last December — a major reversal, since the chip had been completely banned for China.
But Beijing, intent on shielding domestic chipmakers, held back purchasing permits for Chinese companies. This means → the bottleneck isn't just the US export ban; it's also China's own protectionist logic.
Last July, China's internet regulator warned that Nvidia's H20 chip (a lower-tier model) could be remotely tracked or disabled, dampening Chinese firms' willingness to buy. Nvidia said its products contain no backdoors.
What does this mean for Nvidia?
CEO Jensen Huang said in May he had "zero expectations" of getting Chinese government approval to sell advanced chips in China. If this permit goes through, it would be the first tangible recovery signal for Nvidia's China revenue since it shrank sharply last year.
But under 200,000 chips + a mandate to use domestic silicon for inference = Nvidia's rebound in China remains tightly capped.
In plain terms = good news for Nvidia, but a long way from "back in the China market" — more like a small window than an open door.
Content is for reference only, not financial advice.