Nvidia intends to increase H200 chip production due to increasing Chinese demand

According to sources, Nvidia is considering expanding its production capacity for its H200 AI chips to meet demand from China.

The high demand is the result of the US government’s decision to allow the export of H200 graphics processing units (GPUs) to China.

Nvidia’s second-most advanced AI chips were initially subject to US export restrictions. However, last week, President Donald Trump announced that these chips may be shipped to Chinese customers under certain conditions, including a 25 percent tariff for importers.

The president didn’t specify whether there would be a limit on the number of H200 chips authorized for shipment or what other conditions might apply, only that the Commerce Department was “finalizing the details.”

The president’s order boosted the demand for the chip from major Chinese companies, including Alibaba and ByteDance. Previously, Nvidia’s H20, a less powerful version of the H100 GPU, the H200’s predecessor, was the most advanced chip allowed to be shipped to China.

However, uncertainties remain as Beijing has yet to greenlight any purchases of the H200 AI chip. In the past, the Chinese government has discouraged companies from using Nvidia’s chips due to national security concerns.

At the same time, Nvidia’s H200 GPUs could be used to enhance the country’s military capabilities, test new weapons, and develop advanced AI surveillance tools.

The Financial Times recently reported that Beijing will only approve the purchase of H200 chips if companies can demonstrate that Chinese chipmakers are unable to meet their demand.

Citing multiple sources, Reuters says that Chinese officials will meet on Wednesday to discuss the matter and will decide whether the H200 chips are allowed to be shipped into China.

Unlock more exclusive Cybernews content on YouTube.