Beijing’s move to restrict the sale of Nvidia’s H20 AI chips reportedly came in response to remarks made by U.S. Commerce Secretary Howard Lutnick, which some Chinese officials deemed “insulting,” according to the Financial Times. The H20 is a tailored version of Nvidia’s AI processor designed specifically for China. Chinese regulators began discouraging domestic tech firms from purchasing the chip shortly after Lutnick’s comments.
On July 15, just a day after the Trump administration lifted a ban on H20 exports, Lutnick stated that the U.S. doesn’t sell China its best or even second-best chips. He further remarked that the goal was to get Chinese developers “addicted” to American technology. These statements reportedly angered senior Chinese officials and prompted a push to limit domestic use of the H20, leading many companies to scale back or delay orders.
This development is a blow to Nvidia, despite CEO Jensen Huang’s recent visit to Beijing, where he reaffirmed commitment to the Chinese market. Meanwhile, China’s Cyberspace Administration also raised security concerns about the H20, including alleged tracking features—claims Nvidia has denied.
