The US approved NVIDIA AI chip sales to China, but nobody is buying yet

NVIDIA appeared to score a major win after the United States approved sales of its H200 AI chips to several Chinese companies. Big names, including Alibaba, Tencent, ByteDance, and JD.com, were reportedly cleared to buy the chips, which are NVIDIA’s second-most powerful AI accelerators currently allowed for China.

But there is one major problem. Nobody has actually bought them yet.

According to Reuters, not a single H200 delivery has been completed despite approvals already being granted to roughly 10 Chinese firms. The situation has left NVIDIA stuck in a strange position where it technically has permission to sell advanced AI hardware into China, but the deals remain frozen before shipments can even begin.

The delay is becoming another example of how complicated the U.S.-China tech rivalry has become. Even when governments approve business transactions, political pressure and security concerns can still stop them from moving forward.

Jensen Huang joined Trump’s China trip as NVIDIA searches for answers

The issue became serious enough that Nvidia CEO Jensen Huang joined President Donald Trump during a May visit to Beijing.

Reuters reported Huang was not originally expected to join the White House delegation. He later received an invitation and traveled with Trump during meetings connected to Chinese President Xi Jinping.

The trip raised hopes that NVIDIA could finally break through the political gridlock surrounding its China business. China used to be one of NVIDIA’s biggest markets before export restrictions tightened over advanced AI chips.

Before those restrictions, NVIDIA reportedly controlled around 95 percent of China’s advanced AI chip market. China also represented roughly 13 percent of NVIDIA’s revenue at one point, showing how important the country once was to the chipmaker’s growth plans.

China’s AI industry is becoming more cautious about foreign chips

The stalled sales are not only about Washington restrictions anymore. Beijing now appears increasingly hesitant as well.

According to Reuters, Chinese firms pulled back from deals after guidance from Beijing. Officials reportedly worry that relying too heavily on foreign AI hardware could weaken China’s long-term push to build a self-sufficient semiconductor industry.

That shift has helped local companies gain more attention, especially Huawei. Chinese AI firms like DeepSeek have increasingly highlighted their use of domestic AI chips instead of NVIDIA hardware.

The growing support for local alternatives shows how quickly the market has changed. NVIDIA once dominated China’s AI infrastructure, but export controls and political tensions created room for domestic competitors to expand.

Even U.S. officials acknowledged the situation publicly. Commerce Secretary Howard Lutnick recently said the Chinese government had not yet allowed firms to proceed with purchases because Beijing wanted investment focused on its own chip industry.

The approval process comes with strict conditions on both sides

The H200 approvals also come with layers of restrictions that make deals harder to finalize.

Under U.S. export rules introduced earlier this year, Chinese buyers must prove the chips will not be used for military purposes. They also need to show they have proper security protections in place before receiving hardware.

NVIDIA itself faces additional requirements. The company reportedly must confirm that sufficient chip inventory remains inside the United States before shipments can move overseas.

Another unusual part of the arrangement involves money. Reuters reported that the Trump administration had negotiated a system where the U.S. government would receive 25 percent of the revenue from the chip sales. Because U.S. law does not allow direct export fees in this situation, the chips would first pass through U.S. territory before eventually heading to China.

That structure reportedly triggered concerns in Beijing about possible tampering or hidden security vulnerabilities inside the supply chain.

At the same time, China has reportedly introduced new supply chain security regulations designed to reduce dependence on foreign technology in critical systems. Those policies are now adding another layer of scrutiny to NVIDIA’s potential sales.

NVIDIA is caught between two governments fighting for AI leadership

The larger issue for NVIDIA is that both Washington and Beijing are now treating AI chips as strategic national assets rather than normal commercial products.

Some American lawmakers and policy experts argue that NVIDIA should not be allowed to strengthen China’s AI capabilities at all. Critics believe every advanced chip sold overseas could reduce America’s lead in artificial intelligence.

Chris McGuire from the Council on Foreign Relations told Reuters that more NVIDIA sales to China could ultimately weaken the U.S. advantage in AI development.

Meanwhile, NVIDIA argues that continued restrictions are already damaging its position in one of the world’s largest technology markets. Huang has previously warned that the company’s market share for AI accelerators in China has effectively dropped to zero because of export controls.

The situation leaves NVIDIA trapped in the middle of a geopolitical struggle where business interests, national security concerns, and the future of AI leadership are all colliding at once.

Little-known fact: China’s semiconductor sales climbed to $22.82 billion in January 2026, highlighting how massive the country’s chip market remains despite growing pressure from U.S. export restrictions.

A frozen deal says a lot about the future of the AI race

What makes this situation unusual is that the problem is no longer just U.S. export bans. NVIDIA has received U.S. licenses to sell H200 chips to approved Chinese buyers, but it still lacks the Chinese approval needed for sales to proceed. The challenge now is convincing regulators and buyers on both sides that the deals are worth the political and strategic risks attached to them.

That could become a bigger pattern across the global AI industry.

As countries race to control AI infrastructure, semiconductors are increasingly being treated less like commercial technology products and more like strategic resources tied directly to economic power and national security.

For NVIDIA, the H200 delay shows that winning regulatory approval may no longer be enough to guarantee business in China.

TL;DR

• The U.S. approved NVIDIA’s H200 AI chip sales to around 10 Chinese firms, including Alibaba and Tencent.
• Despite the approval, no chips have been delivered yet.
• China is reportedly becoming cautious about depending on foreign AI hardware.
• NVIDIA once controlled nearly all of China’s advanced AI chip market, but export restrictions changed the landscape.
• The delay highlights how the AI race between the U.S. and China is now affecting even approved business deals.

This article was made with AI assistance and human editing.

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