Nvidia H200 chip Photo: VCG

Nvidia has not yet sold any of its advanced H200 artificial intelligence (AI) chips to Chinese companies, US Commerce Secretary Howard Lutnick reportedly said, despite earlier US approval for limited exports. A Chinese analyst pointed to lingering market concerns over the security of Nvidia's products and Washington's flip-flopping export rules.

Lutnick told a Senate hearing on Wednesday that "we have not sold them chips as of yet," claiming hurdles Chinese firms face in securing government approvals, as well as China's policy focus on bolstering its domestic semiconductor ecosystem, according to a Reuters report.

In January, the US government give a formal green light to exports of Nvidia's second-most advanced AI chips to China, but subject to stringent licensing requirements, third-party vetting and end-use restrictions, according to media reports.

Shipments have been stymied by disagreements over the terms of the sales on both the Chinese and US sides, Reuters reported on Wednesday, citing sources. In February, Reuters also reported that sales of the chips to China remained pending a US national security review.

Blaming the failed H200 sales on licensing hurdles on the Chinese side deflects from the real causes of the impasse, Ma Jihua, a veteran tech industry analyst, told the Global Times. "The stalled sales almost certainly stem from distrust driven by the instability of US export policies, as well as previously reported 'backdoor' concerns surrounding Nvidia's products." 

"The US has increasingly framed trade in national security terms, disrupting normal business activity," Ma said, adding that the long procurement cycle for advanced chips - coupled with reports that Nvidia has required some Chinese clients to make upfront payments - means companies could face significant financial losses if supply is cut off after payment, a risk many are reportedly unwilling to bear.

Reuters reported in January that Nvidia was requiring full upfront payment from Chinese customers seeking its H200 AI chips. The US chipmaker also had imposed unusually stringent terms, with orders non-cancellable and non-refundable, and no option to modify configurations after placement, the report said, citing sources.

US lawmakers last year had already flagged potential risks, including calls for embedded tracking and verification functions, noting that such capabilities were already present in some chips, according to Reuters. In July, 2025, China's cyberspace regulator summoned Nvidia to explain potential "backdoor security risks" in its H20 chips and to provide supporting materials, according to Xinhua.

Aside from security concerns, Ma said Nvidia is supplying only a downgraded generation of chips to China. While it retains advantages in computing power and ecosystem, these structural limitations mean its products do not meet Chinese firms' needs for sustainable development, he added.

"Any disruption would make switching to alternative technology routes extremely costly, risking a missed competitive window," the expert said. 

Nvidia had not agreed to certain conditions set by Washington for China-bound sales, Reuters reported in February. The company also warned in a statement that "for American industry to make any sales, the conditions need to be commercially practical, or the market will continue to move to foreign alternatives."

Meanwhile, the US is stepping up restrictions on chipmaking equipment. A US House Representatives panel voted on Wednesday to advance the MATCH Act, which reportedly aims to close gaps in export controls and pressure non-US suppliers to Chinese chipmakers to comply with restrictions imposed on US firms, according to Reuters.

US restrictions have arbitrarily constrained China's access to cutting-edge hardware or equipment in the short term while reinforcing incentives for indigenous innovation over the longer term, analysts said.

Chinese companies have made notable progress across key segments, including chip design, architecture and equipment, while software ecosystems are also evolving rapidly through real-world use, Ma said.

Nvidia's China business has historically been a major growth driver, with its CEO Jensen Huang has repeatedly warned of the costs of losing the Chinese market. 

Speaking on the Dwarkesh Podcast last week, he said that if future AI models are "optimised in a very different way" from the American tech stack, and as AI spreads globally with Chinese standards, China "will become superior to" the US, according to the South China Morning Post.

China has consistently advocated win-win cooperation through openness, Ma said, noting that "as long as products are safe and reliable, US companies, including Nvidia, remain welcome to participate in the Chinese market and share its growth opportunities."

Responded to a question on the export of H200 chips to China, Chinese Foreign Ministry spokesperson Mao Ning said in January that on US chips export to China and the tariffs issue, China has made clear its position more than once.

"China firmly opposes the US overstretching the concept of national security and abusing export controls. Such practices seriously disrupt the international economic and trade order, undermine the stability of global industrial and supply chains, and harm the interests of all countries," Lin Jian said previously when commenting on US export controls on chipmaking equipment to China.