The United States will allow Nvidia’s H200 AI chips, its second most advanced processors, to be exported to China with a 25% fee, President Donald Trump announced on Monday.
The move aims to balance national security with maintaining US leadership in AI technology. It is unclear whether the decision will increase sales, as China has instructed companies to avoid US technology. Nvidia shares rose 2% in after-hours trading following the announcement.
Trump said he had informed President Xi Jinping of the decision, which received a positive response. The Commerce Department is finalising details, and similar rules will apply to AMD and Intel. The levy is higher than the 15% initially proposed. Trump stressed that shipments would occur under conditions safeguarding national security.
Concerns over military use
US officials worry the chips could strengthen China’s military, a concern that led to previous export restrictions. Experts note the H200 is nearly six times more powerful than the H20, the most advanced chip currently allowed for export. Critics warn China could copy the technology and boost its domestic AI capabilities.
China’s cautious stance
China is working to reduce reliance on Nvidia chips and has previously flagged potential security risks in downgraded models. Analysts say Chinese companies still desire H200 units, though political concerns may restrict imports. The announcement coincided with news that a US-led operation had dismantled a smuggling ring exporting restricted Nvidia chips worth at least $160 mln to China.
Chinese AI chip firms including Huawei, Cambricon and Moore Threads continue to expand despite regulatory and political hurdles.
