Nvidia Plans H200 Chip Shipments to China Before New Year

Nvidia has announced plans to begin shipping its H200 AI chips to China by mid-February 2024, ahead of the Chinese New Year holiday. According to three sources familiar with the situation, the shipments are expected to comprise between 5,000 and 10,000 chip modules, which equates to approximately 40,000 to 80,000 H200 chips. The company intends to fulfill initial orders from its existing stock while also indicating plans to expand production capacity for these chips in the future.

Production Plans and Approval Process

The sources revealed that Nvidia aims to open orders for increased production capacity in the second quarter of 2026. However, significant uncertainty looms over the shipments as Chinese authorities have yet to approve any purchases of the H200 chips. “The whole plan is contingent on government approval,” stated one source, emphasizing that nothing is certain until the official go-ahead is received.

Both Nvidia and the Ministry of Industry and Information Technology in China did not respond immediately to requests for comment. The anticipated shipments would represent the first delivery of H200 chips to China following a recent announcement by former US President Donald Trump. This announcement indicated that Washington would permit such sales with a 25 percent fee attached.

Policy Shift and Industry Impact

This decision marks a notable shift in policy from the previous Biden administration, which had banned the sale of advanced AI chips to China due to national security concerns. The H200 chips, part of Nvidia’s earlier Hopper line, continue to be widely utilized in AI applications, even though they have been succeeded by the newer Blackwell chips.

In light of these developments, the Trump administration has initiated an inter-agency review of license applications for H200 chip sales to China. This action aligns with Trump’s commitment to allowing the sales, which could have implications for China’s burgeoning domestic AI chip industry. Local firms have struggled to match the performance of the H200, raising fears that permitting imports might hinder their progress.

Chinese officials reportedly convened emergency meetings earlier this month to deliberate on the potential shipments, weighing the implications of allowing these advanced chips into the market. One proposal under consideration involves requiring that each H200 purchase be accompanied by a specific ratio of domestic chips.

For leading Chinese technology companies, such as Alibaba Group and ByteDance, the prospective deliveries could provide access to processors that are approximately six times more powerful than the H20, a downgraded chip specifically designed by Nvidia for the Chinese market.

The unfolding developments surrounding Nvidia’s H200 chip shipments to China reflect broader tensions and strategic considerations in the global tech landscape, underscoring the intricate balance between innovation and regulatory oversight.