China Asks Tech Firms to Stop Buying Nvidia H200 AI Chips
By Reuters | 07 Jan, 2026

Beijing seeks to discourage stockpiling of US chips as it finds a balance between expanding AI capabilities and incentivizing development of domestic chipmaking.

Beijing has asked some Chinese tech companies to halt orders for Nvidia's H200 chips this week, and is expected to mandate domestic artificial intelligence chip purchases, the Information reported on Wednesday, citing people familiar with the matter.

Nvidia has been caught between Washington and Beijing, as the United States tightens controls on exports of advanced semiconductors used in AI, while Chinese companies seek to reduce reliance on U.S.-designed chips.

Tensions over technology trade have been a central feature of broader U.S.-China conflicts, with semiconductors emerging as a strategic flashpoint.

China's directive to suspend orders was issued as the government considers whether, and under what conditions, to allow access to Nvidia's high-performance chips.

Beijing is aiming to discourage local technology companies from rushing to stockpile U.S. chips before a decision is reached, the report said.

Nvidia and the Chinese embassy in the U.S. did not immediately respond to Reuters' requests for comment.

China's Ministry of Commerce and Ministry of Industry and Information Technology also did not immediately return calls outside business hours.

Nvidia CEO Jensen Huang said at the Consumer Electronics Show this week that demand in China for its H200 chip was strong and the company is viewing purchase orders as a signal of approval rather than expecting any formal announcement from Beijing. 

U.S. export licenses for the chips are still being processed, with no set timeline.

Late last year, U.S. President Donald Trump's administration approved the export of H200 chips to China, a significant reversal of previous bans on advanced AI hardware. 

The approval was based on a condition that the company pay a unique 25% revenue-sharing tax to the U.S. government.

The H200 is the predecessor to Nvidia's current flagship "Blackwell" chips. 

(Reporting by Akash Sriram in Bengaluru; Editing by Anil D'Silva and Shinjini Ganguli)