Nvidia is reportedly evaluating plans to ramp up production of its powerful H200 artificial intelligence chips after receiving approval to sell the processors to Chinese companies, according to a Reuters report citing anonymous sources. The move comes amid a surge in demand from China’s tech giants, highlighting the country’s ongoing race to advance its AI capabilities despite years of export restrictions.
The H200 GPU is the most advanced chip from Nvidia’s Hopper generation designed for training large language models and other complex AI workloads. Under rules proposed during the Biden administration, Nvidia was previously barred from selling the H200 in China due to national security concerns surrounding advanced AI hardware. That stance shifted last week when the U.S. Department of Commerce approved H200 exports to China under a licensing framework, reportedly in exchange for Nvidia agreeing to a 25% cut in sales of those chips.
Following the approval, Chinese companies have moved quickly to secure access. Firms such as Alibaba and ByteDance, both heavily invested in developing large-scale AI models, have reportedly contacted Nvidia to discuss placing substantial orders. The H200 is seen as a major step up from the H20 GPUs Nvidia had earlier customized for the Chinese market, offering significantly higher performance for training next-generation AI systems.
As demand accelerates, Nvidia is now weighing whether to add manufacturing capacity for the H200, which is currently produced in limited volumes. Expanding output would allow the company to capture pent-up demand in one of the world’s largest AI markets at a time when Chinese firms are under pressure to compete with U.S.-based AI leaders.
However, uncertainty remains. Chinese regulators are still deliberating whether to formally allow the import of the H200 chips, a decision that could influence how aggressively Nvidia proceeds with production expansion. Meanwhile, Chinese companies continue to invest heavily in developing domestic alternatives, focusing on software efficiency and system optimization to compensate for limited access to cutting-edge hardware.
From Nvidia’s perspective, balancing global supply is critical. In a statement, an Nvidia spokesperson said the company is managing its supply chain carefully to ensure that licensed H200 sales to authorized Chinese customers do not impact its ability to serve U.S. clients. This reassurance comes amid heightened scrutiny from U.S. policymakers concerned about technology leakage and strategic competition.
If approved at scale, H200 shipments to China could represent a meaningful revenue opportunity for Nvidia while underscoring the complex intersection of geopolitics, national security, and the global AI hardware race.
