They choose not to buy because they want to develop their own: China just refused to buy a single Nvidia AI chip as Trumps plan backfires

Date:
Tue, 26 May 2026 19:00:00 +0000

Description:
China has refused to buy Nvidias H200 AI chips despite personal intervention from Donald Trump.

FULL STORY ======================================================================Copy link Facebook X Whatsapp Reddit Pinterest Flipboard Threads Email Share this article 0 Join the conversation Follow us Add us as a preferred source on Google Newsletter Subscribe to our newsletter China has refused to buy any H200 AI chips from Nvidia The move might be due to costs or security concerns It comes after a personal intervention from Donald Trump failed to work Right now, there are two main players in the world of artificial intelligence (AI) hardware: Nvidia , which makes some of the best-performing AI chips , and China, which has a surging domestic industry that isnt as reliant on Nvidia . US President Donald Trump has been trying to change that situation and help Nvidia penetrate the Chinese market, but it looks like his latest efforts
have backfired spectacularly potentially ensuring Nvidia misses out on $30 billion worth of sales.

Last week, the US Commerce Department approved sales of Nvidias H200 AI chip to ten Chinese firms, including names like Alibaba and Tencent. That could have brought in $15-$20 billion for Nvidia at current prices, with financial analyst John Vinh saying Chinese demand sits at up to $30 billion, according to Moneywise . Yet in a major blow to Trump and Nvidia CEO Jensen Huang , the Chinese government has declined to approve purchases of the chips by its domestic industry. Trump and Huang had traveled for a meeting with Chinese President Xi Jinping in an attempt to persuade him to allow the H200 sales to proceed. Instead, they came away empty-handed, with Nvidia telling investors its official market share in China is now effectively non-existent. Latest Videos From You may like 'We will be taking action to protect American innovation': White House accuses China of 'systematically' extracting
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Speaking to reporters aboard Air Force One, Trump said of China: They have a much higher level than H200. China needs it and yeah, it came up. They choose not to buy because they want to develop their own. I think something could happen on that.

In other words, China prefers to orient its AI industry around its own domestically made chips rather than paying to use American imports. And it looks like there are several reasons for that. Ongoing computing chaos (Image credit: Communications Today) One reason Chinese firms might not want to use American AI chips, like those manufactured by Nvidia, is that they have to
pay a sizeable fee for the privilege. Trump has managed to create an arrangement whereby the US government will levy a 25% tariff on every chip Nvidia sells to China, pushing the price up for these overseas buyers.

But Beijing could be worried about something else. Since US law prohibits direct export fees, the chips must be routed through US territory before heading to China. And that has stoked fears in China that the chips could be tampered with perhaps to install spyware, for example before being sent abroad. That has led the Chinese government to turn inwards and provide more support to its own domestic industry rather than foreign firms like Nvidia. Get daily insight, inspiration and deals in your inbox Sign up for breaking news, reviews, opinion, top tech deals, and more. Contact me with news and offers from other Future brands Receive email from us on behalf of our
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What does this mean for you? Well, we might see Chinese AI models like DeepSeek becoming increasingly optimized for Chinese hardware. That was already happening before the latest move DeepSeeks V4 update was optimized for Huaweis Ascend chips rather than Nvidia's, for instance but we could see more of this going forward. If you want to use those AI models, you might
find yourself disadvantaged when using a device outfitted with a chip from Nvidia, AMD , or Intel .

Beyond that, it demonstrates that the ongoing computing chaos caused by the
AI boom is still in full swing. With component prices through the roof and uncertainty over future sales for Nvidia currently one of the worlds biggest tech firms its anyones guess what will happen next. Follow TechRadar on Google News and add us as a preferred source to get our expert news, reviews, and opinion in your feeds. The best laptops for all budgets Our top picks, based on real-world testing and comparisons

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Link to news story: https://www.techradar.com/computing/they-choose-not-to-buy-because-they-want-t o-develop-their-own-china-just-refused-to-buy-a-single-nvidia-ai-chip-as-trump s-plan-backfires


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