Nvidia's $1 Billion AI Chip Deal with China Amid US Export Restrictions

Nvidia's AI chips worth $1 billion were shipped to China after US export curbs. The chips were exported in the three months following the US tightening of chip export controls. The news was based on an analysis of sales contracts, company filings, and sources familiar with the matter.

In a significant development, Nvidia's advanced artificial intelligence (AI) chips, valued at over $1 billion, were reportedly smuggled into China despite stringent US export controls. The incident, which occurred over a three-month period following the tightening of US regulations, has raised concerns about the enforcement of trade controls and the intense geopolitical rivalry between the US and China.

The Financial Times reported that Nvidia's high-end B200 processors, which were banned for sale in China, were widely available on the Chinese black market. Chinese distributors from provinces including Guangdong, Zhejiang, and Anhui sold these chips to local AI data center providers. The report cited sales contracts, company filings, and multiple people with direct knowledge of the deals.

Nvidia stated that building data centers with smuggled products is technically and financially inefficient, as the company only offers service and support for authorized products. The US Department of Commerce, White House, and Thai government did not immediately respond to requests for comment.

The U.S. and China are engaged in a fierce competition for global dominance in AI and other cutting-edge technologies. Nvidia, a key player in this arena, has been navigating complex geopolitical and regulatory pressures. Last week, Nvidia CEO Jensen Huang announced that the company would resume selling its H20 chips to China after a breakthrough with the Trump administration on regulations.

This development underscores the challenges faced by companies operating in a highly regulated environment. The U.S. Commerce Department is considering adding more export controls on advanced AI products to countries such as Thailand as soon as September.

References:
[1] https://m.economictimes.com/tech/artificial-intelligence/nvidia-ai-chips-worth-1-billion-entered-china-despite-us-curbs-ft/articleshow/122895024.cms
[2] https://www.storyboard18.com/digital/nvidia-ai-chips-worth-over-1-billion-smuggled-into-china-despite-us-ban-report-76977.htm
[3] https://www.cnbc.com/2025/07/24/nvidia-ai-chips-smuggling-china-trump.html
[4] https://www.inkl.com/news/financial-times-report-suggests-chip-smugglers-shifted-an-alleged-1-billion-worth-of-nvidia-s-ai-chips-to-china-over-the-course-of-3-months-while-stricter-us-export-controls-were-in-effect