Nvidia says Trump administration will allow AI chip sales to China but there's a catch

Mint

10 hours ago

Nvidia on Monday said that the Trump administration has reversed course and approved the sale of its China-specific AI chips, known as the H20. While the company will still require approval from the US government for each shipment, it said in a blog post that the Trump administration has 'assured NVIDIA that licenses will be granted'.
The move comes just three months after the US government halted Nvidia's AI chip sales to China in a bid to prevent the country from gaining an edge in the artificial intelligence race. According to a New York Times report, US officials were previously concerned that the Chinese military could use Nvidia's AI chips to coordinate attacks and develop advanced weapons.
US Commerce Secretary Howard Lutnick told Congress during his nomination hearing that Nvidia and other companies need to 'stop helping China' use 'our tools to compete with us'. Lutnick reiterated these concerns last month, stating, 'They are trying to copy our technology, and in the race for A.I. supremacy, they are behind us, but they are working with a central government out
The decision to reverse ban on Nvidia chips came after CEO Jensen Huang met with President Trump last thursday. The NYT report notes taht Huang has spent the last few months lobbying politicians acoss Washington to keep China open for AI chips.
Huang also visited China several times this year and will be on another trip this week where he will also give a news conference. Nvidia was expected to collect up to $15 billion from the H20 sales this fiscal year before the Trump administartion mandate.
On the threat of Chinese military using the AI chips, Huang told CNN's Fareed Zakaria, 'We don't have to worry about it,'
'They simply can't rely on it…It could be, of course, limited at any time.' he added
After the US restrictions on sales of AI chips, Nvidia began throttling the performance its H100 chip and marketing it as H20 China. However, the H20 has reportedly significantly better memoery capabilities which are more valuable for running AI interference.