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Nvidia wins approval to export AI chips to China Following Oval Office talks

09 August 2025 15:35

The US Commerce Department has begun issuing licenses for Nvidia to export its H20 artificial intelligence chips to China, ending weeks of delay following a high-level meeting between the company’s chief executive, Jensen Huang, and President Donald Trump.

A US official confirmed to the Financial Times that the Bureau of Industry and Security, which oversees export controls, started approving the H20 licenses two days after Huang’s latest visit to the White House. People familiar with the matter said the decision to proceed came directly after Huang’s Oval Office meeting with the president.

The H20 chip was designed specifically for the Chinese market after the Biden administration imposed strict export controls on more advanced AI processors. In April, the Trump administration initially took a tougher stance, blocking sales of the H20 to China. However, Trump reversed course after an earlier meeting with Huang, though Nvidia expressed frustration that no licenses had been issued in the three weeks following the decision.

The move has sparked debate in Washington. Security officials have warned that allowing China to buy the H20 could strengthen its military capabilities.

In a letter to Commerce Secretary Howard Lutnick, 20 security experts—including Matt Pottinger, former deputy national security adviser under Trump, and David Feith, a recent National Security Council official—urged the administration to block the sales. They argued the move would be a “strategic mis-step that endangers the United States’ economic and military edge in artificial intelligence.”

Nvidia has rejected those claims, calling them “misguided” and insisting the H20 does not pose a military threat. The company warns that restricting US chip exports only accelerates Chinese innovation and boosts competitors like Huawei.

The stakes are high for Nvidia. The company took a $4.5 billion hit in the July quarter, along with $2.5 billion in missed sales, after the original licensing requirement was introduced, wiping out sales it had expected to continue in China. 

The ban was widely viewed as a potential death blow to Nvidia’s legal AI chip business in a market that Huang has projected could be worth $50 billion within two to three years. Nvidia had forecast an $8 billion loss in China revenue for the July quarter alone.

Huang has repeatedly criticised US export policies, warning that they are a “failure” and risk ceding technological leadership to China.

Nvidia’s share of China’s AI chip market has already fallen from 95 per cent to 50 per cent in four years as domestic rivals gain ground. The company has been working on redesigned AI chips that comply with the latest US export rules to maintain a foothold in the Chinese market.

By Tamilla Hasanova

Caliber.Az
Views: 169

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