Nvidia considers increasing H200 chip output due to robust China demand sources say

Nvidia opens new tab has told Chinese clients it is evaluating adding production capacity for its powerful H200 AI chips after orders exceeded its current output level, according to two sources briefed on the matter.

The move comes after U.S. President Donald Trump said on Tuesday the U.S. government would allow Nvidia to export H200 processors, its second-fastest AI chips, to China and collect a 25% fee on such sales.

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Demand for the chip from Chinese companies is so strong that Nvidia is leaning toward adding new capacity, one of the sources said. They declined to be named as the discussions are private.

“We are managing our supply chain to ensure that licensed sales of the H200 to authorized customers in China will have no impact on our ability to supply customers in the United States,” an Nvidia spokesperson said in a statement to Reuters after the story was published.

Major Chinese companies including Alibaba (9988.HK), opens new tab and ByteDance have already reached out to Nvidia this week about purchasing the H200 and are keen to place large orders, Reuters reported on Wednesday.

However, uncertainties remain, as the Chinese government has yet to greenlight any purchase of the H200. Chinese officials convened emergency meetings on Wednesday to discuss the matter and will decide whether to allow it to be shipped into China, said one of the two sources and a third source.

Very limited quantities of H200 chips are currently in production, Reuters reported on Wednesday, as the U.S. AI chip leader is focused on producing its most advanced Blackwell and upcoming Rubin lines.

Supply of H200 chips has been a major concern for Chinese clients and they have reached out to Nvidia seeking clarity on this, sources said.

As part of the briefing provided by Nvidia, the company has also given them guidance on current supply levels, said one of the first two people, without providing a specific number.