Nvidia's first H200 chip shipment granted approval to enter China

After steering through the regulatory and tariff-related obstacles, the first batch of Nvidia's H200 AI chips is to be delivered in China after the country approved the import.

The sale of H200 chips, Nvidia's second-most powerful AI chip, in China serves as an indication of mending ties between Beijing and the US, as the government aims to balance its AI requirements with the need to promote domestic development, Reuters reported, citing three sources familiar with the issue.

Major Chinese firms, including ByteDance, Alibaba, and Tencent, have been granted approval to purchase over 400,000 H200 chips in total, with additional companies now awaiting subsequent approvals, as stated by two anonymous sources.

The move comes at a time when Nvidia CEO Jensen Huang is visiting China.

Despite strong demand from Chinese companies and US approval for exports, Beijing has been blocking the H200 chip shipments.

Earlier this month, the US formally allowed Nvidia to sell the H200 to China, a market with substantial interest.

Until recently, there was uncertainty regarding Beijing's approval, as the government was said to be focusing on balancing high domestic demand for advanced AI chips by boosting its semiconductor industry.

Nevertheless, Chinese firms have ordered over two million H200 chips, exceeding Nvidia's current inventory by a huge margin.

The approvals for the H200 suggest that Beijing is dedicated to meeting the needs of renowned Chinese internet companies that are investing billions in data centres to develop AI services and compete with the US.

Although Huawei and other Chinese tech companies have developed AI chips to rival Nvidia’s previous H20 chip, they still lag behind the performance of the H200.