China Bans Domestic Tech Companies from Buying Nvidia AI Chips, Striking a Blow to Global Market Leader
The Chinese market has blocked purchases of Nvidia’s AI chips, with the decision coming from the country’s internet regulator, the Cyberspace Administration of China. This move was reported initially by Financial Times on Wednesday.
The agency instructed domestic tech giants such as ByteDance and Alibaba to halt testing and ordering of Nvidia’s RTX Pro 6000D server, a product specifically designed for the Chinese market.
Earlier in August, Beijing had discouraged companies from procuring these chips, advocating instead for local manufacturers.
This ban could have significant implications for China’s tech sector. While domestic firms like Huawei and Alibaba develop AI chips domestically, Nvidia is a global market leader, known for producing some of the most advanced chips available.
In response to this development, Nvidia issued a statement from Huang during a press conference on Wednesday. Huang expressed disappointment but acknowledged that larger geopolitical issues were at play, stating, “We can only serve a market if a country wants us to be. I am patient about it. We will continue to support the Chinese government and Chinese companies as they wish.”
In April, the Trump administration imposed licensing requirements on semiconductor companies, including Nvidia, restricting their sales in China. Huang previously forecasted that Nvidia would lose approximately $8 billion in revenue in the second quarter alone due to this ban, as revealed during the company’s first-quarter earnings call.
In June, Nvidia announced it would exclude China from its future profit projections, given the market’s de facto closure to the company. In July, the Trump administration allowed semiconductor companies to resume sales in China, but under the condition that 15% of the revenue from the chips sold would go to the U.S. government. However, as of Nvidia’s latest earnings report, no units had been sold to Chinese customers under this arrangement, due to the slow implementation of President Trump’s proposal.
