US may restrict Nvidia H200 sales to China amid sales concerns

US officials are reportedly considering imposing restrictions on the export of Nvidia's H200 artificial intelligence accelerators to Chinese companies. This potential limitation arises amid concerns that the sales of Nvidia chips in China are declining even after the company secured US approval for sales.

According to a report by Bloomberg, discussions within the US administration suggest that Chinese firms may be restricted to purchasing only 75,000 units of the H200 chips. This move could severely curtail Nvidia's market presence in a critical region.

In addition to Nvidia's H200, other chips with comparable capabilities, such as Advanced Micro Devices Inc's MI325, may fall under this new purchasing cap. Such measures could hinder the chipmaker's capacity to reestablish its foothold in the Chinese marketplace.

Concerns about additional conditions on H200 sales have intensified within the US, with some advocating for measures to restrict China's technological development. However, there are voices, like industry analyst Ma Jihua, who argue that inhibiting China's technological growth through such constraints is unlikely to yield the desired results.

Despite recent attempts by Washington to ease export rules, Nvidia has not shipped any H200 units to China yet. This stagnation illustrates the challenges posed by the ongoing uncertainties in US trade policies.

Bloomberg reports that, under the new proposed framework, total shipments to China could still reach as high as one million units, maintaining the previously established upper limit. However, individual customer restrictions complicate Nvidia's path back into its largest market.

Speculation surrounds these developments, especially with President Donald Trump's anticipated visit to China. It is believed that this visit may be pivotal in finalizing an agreement on H200 sales to non-military Chinese enterprises.

Ma Jihua notes that whether such measures are a form of market manipulation or negotiation tactics, they have thus far proven ineffective in limiting China's technological aspirations.

Domestically, Chinese chip manufacturers are advancing steadily, bridging gaps in demand, and reducing reliance on foreign technology, as market need for advanced computing power diminishes swiftly.

The US government's repeated interventions in semiconductor sales create substantial uncertainty, which might dissuade Chinese firms from purchasing advanced chips due to fears of sudden policy shifts. This context was highlighted further when the Cyberspace Administration of China questioned Nvidia over its H20 AI chip's security risks.

As tensions grow, the Chinese government has denounced US efforts to politicize technology and trade, reiterating its commitment to opposing any actions perceived as obstructing China's technological growth. The potential implications for global supply chains remain considerable.