The US government approved around 10 Chinese companies to buy Nvidia H200 AI chips, but not a single chip has been delivered, according to three people familiar with the matter who spoke to Reuters.
Companies including Alibaba, Tencent, ByteDance, and JD.com got approval from the US Commerce Department to purchase up to 75,000 H200 chips each. Distributors like Lenovo and Foxconn also received approval to resell the chips.
Despite that, Chinese firms pulled back after guidance from Beijing, one of the three sources said. China's government had quietly told domestic tech companies to pause H200 orders as the country pushes to build its own AI chip industry with companies like Huawei and DeepSeek.
Huang wasn't on the Beijing trip until Trump called him
That deadlock is why Nvidia CEO Jensen Huang is in Beijing today. He wasn't originally on President Donald Trump's delegation list to Beijing this week. But after media coverage of his absence, Trump called Huang directly and invited him to join, a source familiar with the situation told CNBC.
Huang flew to Alaska on Tuesday night to board Air Force One.
What Huang is trying to unlock is worth billions. He has said China's AI market could be worth $50 billion, and China once accounted for 13% of Nvidia revenue before export restrictions tightened. Before US export curbs kicked in, Nvidia commanded about 95% of China's advanced chip market.
Huang told investors in April that Nvidia market share in China's AI accelerator market has now fallen to zero. "In China, we have now dropped to zero," Huang said at a Special Competitive Studies Project panel. "Conceding an entire market the size of China probably does not make a lot of strategic sense, so I think that has already largely backfired."
What's blocking the chips from shipping
Commerce Secretary Howard Lutnick confirmed China's position at a Senate hearing last month. "The Chinese central government has not let them, as of yet, buy the chips, because they're trying to keep their investment focused on their own domestic industry," Lutnick said.
US rules issued in January require Chinese buyers to prove they have sufficient security procedures and won't use the chips for military purposes. Trump also negotiated a deal where 25% of H200 revenue goes to the US government, which requires the chips to pass through US territory before shipping to China.
Beijing suspects the routing creates tampering risks, though sources describe it mainly as a legal workaround since US law doesn't allow direct export fees.
Huang told state broadcaster CCTV today that he hoped Trump and Xi would "build on their good relationship" during talks in Beijing to improve ties between the two countries. This comes as Nvidia stock hit an all-time intraday high of $227.84 on Wednesday, closing at $225.83. The company is set to report first quarter fiscal 2027 earnings on May 20.
