Nvidia Seeks US Approval for Scaled-Down China Chips

 

Nvidia CEO Jensen Huang has confirmed that the company has begun discussions with the White House over approval to sell a scaled-down version of its Blackwell AI chips to China.

The proposed chips would be 30–50 percent less powerful than the originals, as Nvidia seeks access to China’s $50 billion AI market, though potential sales are excluded from its current-quarter forecast due to regulatory uncertainty. Earlier reports suggested Nvidia was preparing a cheaper Blackwell variant for China, but so far no orders have been received for its existing H20 chips. Huang noted that Nvidia is open to different frameworks to secure export approval, including revenue-sharing if required.

Key Highlights

• Nvidia in talks to sell scaled-down AI chips to China
• US export curbs may accelerate China’s chip industry growth
• China commits $300B to boost AI and semiconductor capacity

Analysts warn that restricting Nvidia could have unintended consequences by accelerating China’s domestic semiconductor industry. In response to U.S. export controls, China has significantly increased investment in AI chips and plans to triple output by 2025. Local firms like Cambricon are already gaining market share, reporting strong revenue growth in 2025.

Policy experts at Brookings argue that aggressive restrictions risk “inadvertently accelerating China’s chip development,” creating the very competition the U.S. seeks to prevent. China has committed over $300 billion toward AI, semiconductors, and EVs, with major expansions such as Tsinghua Unigroup’s $24 billion Wuhan facility upgrade.

Also Read: Nvidia Halts H20 Chip Amid China's Usage Ban

For Nvidia, China represents 15 percent of its global market opportunity, making regulatory outcomes highly consequential. The standoff underscores a strategic dilemma: short-term export restrictions may safeguard U.S. technology but could also strengthen China’s long-term competitiveness.