China has granted permission for the initial consignment of Nvidia Corporation's H200 artificial intelligence (AI) chips to enter the country, primarily benefiting three of the nation's major internet companies, according to a recent report. The names of these recipients were not disclosed, and additional companies are awaiting clearance that is likely to occur in subsequent rounds. The specific criteria Beijing employs to determine eligibility for these AI chip approvals remain unclear.
The approval encompasses several hundred thousand H200 chips and coincided with Nvidia CEO Jensen Huang’s recent visit to China, which aimed to initiate the company’s annual celebrations ahead of the upcoming Lunar New Year in mid-February. During his trip, Huang was reportedly positioned to engage with prospective buyers as well as senior Chinese officials, seeking to facilitate the resumption of chip imports into the Chinese market.
The Nvidia H200 chip has emerged as a focal point in the technological and trade dynamics between the United States and China. Although the U.S. government authorized shipments of the H200, Chinese authorities had previously withheld approvals for their import. This restriction contributed to a robust black market for servers equipped with multiple H200 GPUs, trading at up to 50% above official prices—approximately 2.3 million yuan (around $330,000).
Reports further suggest that Beijing may restrict authorizations for domestic purchases of Nvidia's H200 chips specifically for research purposes, reflecting a cautious approach toward their broader commercial deployment. However, despite these regulatory and supply constraints, demand for the H200 chips in China remains substantial.
Last week at the World Economic Forum in Davos, Switzerland, Jensen Huang highlighted the sustained strong demand for H200 chips from Chinese customers. He pointed out that import approvals so far reflect the Chinese government’s intent to support prominent internet companies that are expanding their data center capabilities to compete vigorously in the AI sector against U.S. industry players.
According to earlier data, Chinese technology companies reportedly placed orders exceeding two million H200 units in the previous month alone, significantly outstripping Nvidia's production capacity. This imbalance between high demand and limited supply underscores the strategic importance of Nvidia’s chips in global AI development efforts.
From a financial perspective, Nvidia has demonstrated strong market performance. Benzinga’s Edge Rankings place the company in the 97th percentile for quality and the 94th percentile for growth metrics, indicating robust operational excellence and expansion potential. Over the past twelve months, Nvidia’s stock price has surged by approximately 46%, and in the most recent trading session, the stock closed 1.10% higher at $188.52.
This initial shipment approval to select firms represents a critical breakthrough in addressing the complex geopolitical and regulatory challenges surrounding high-end AI chip trade between the U.S. and China. Yet, uncertainties remain concerning the scope and speed of further approvals and the exact parameters guiding the Chinese government’s import policies.
Investors and stakeholders in the AI chip ecosystem will continue to observe these developments closely, given the significant implications for technology supply chains, competitive positioning, and market dynamics in both countries.