Nvidia stopped producing H200 chips for China after the Trump administration imposed export controls on advanced AI accelerators, cutting off Chinese companies from cutting-edge compute infrastructure. The GPU maker is negotiating a permitting process with US regulators to potentially resume shipments under strict oversight.
Shares of Nvidia and AMD fell following the announcement, reflecting uncertainty over lost Chinese revenue. Nvidia previously dominated China's AI chip market before earlier restrictions forced the company to develop downgraded variants for Chinese customers. The H200 architecture delivers performance improvements critical for training large language models that power AI systems globally.
The export controls mirror semiconductor restrictions already imposed by the US, European Union, and Japan, creating a tiered global access framework for AI hardware. Chinese AI companies had stockpiled advanced chips anticipating further restrictions, but the production halt eliminates a major supply channel. The move widens the technology gap between Western and Chinese AI development ecosystems.
Washington designated AI lab Anthropic a supply chain risk despite the company closing a $10 billion investment from Nvidia and positioning itself as safety-focused. Anthropic is simultaneously negotiating Pentagon partnerships, highlighting tensions between commercial AI development and national security priorities shared by US allies. The designation complicates international AI cooperation efforts.
The permitting system under development could allow selective exports while blocking others entirely, but the administration has not specified approval criteria or timelines. AMD faces similar pressure as its MI300 chips compete in the same high-performance segment. Nvidia generated billions in Chinese sales before previous restrictions, and alternative markets may struggle to offset those losses.
The restrictions accelerate the fragmentation of global AI infrastructure into competing spheres, with implications for international AI research collaboration and the pace of technology development in different regions.