Nvidia is weighing plans to expand production of its H200 AI chips after Chinese demand surged beyond the current supply, sources told Reuters. The company reportedly informed clients in China that it is assessing additional production capacity following a spike in orders triggered by President Donald Trump’s decision to allow exports of the advanced processors.
Demand from major Chinese tech firms, including Alibaba and ByteDance, has been overwhelming, with several companies seeking large-scale H200 purchases. However, Beijing has yet to approve any import requests, holding emergency meetings this week to decide whether to permit the shipments, sources said.
“We are managing our supply chain to ensure that licensed H200 sales to authorized customers in China will not affect our ability to supply US clients,” Nvidia said in a statement to Reuters.
The H200 is about six times more powerful than the downgraded H20 model currently available in China and represents Nvidia’s most capable AI chip legally accessible under current export rules. Still, quantities remain limited, as Nvidia focuses its production on its newer Blackwell and upcoming Rubin architectures.
Chinese officials reportedly discussed bundling H200 purchases with domestic chip orders, a move aimed at supporting local semiconductor players like Huawei and Cambricon. Despite these efforts, analysts say China’s AI demand far exceeds its domestic production capacity.
“Chinese cloud providers and enterprise clients are placing large orders and lobbying for relaxed restrictions,” said Nori Chiou, investment director at White Oak Capital Partners.
The situation highlights the complex balance between AI competition and supply constraints, as Nvidia navigates political pressures, export controls, and unprecedented global demand for computing power.
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