Nvidia H200 AI chip suppliers have halted production after Chinese customers blocked shipments from entering mainland China due to doubts about the value of a US export license. The first report of this disruption occurred on January 16, 2026, amid US-China semiconductor tensions.
The component makers halted output this week to prevent excess inventory, despite Nvidia’s preparations for March deliveries. The company eyed over 1 million H200 units for Chinese data centers, the second-most powerful lineup after Blackwell. Suppliers conducted round-the-clock readiness amidst regulatory flux. Nvidia could not immediately verify any details related to this; it offered no comments outside hours.
Customs agents notified importers this week that H200 chips “are not permitted to enter the country,” without giving out details about the permanence or rationale. Also, authorities met domestic tech giants, advising against non-essential purchases due to ‘sensitivity,’ as per sources. Beijing’s move might favor Huawei and others or serve as leverage in trade talks with unclear demand signals as of now.
In December 2025, Washington loosened restrictions, giving a green signal to H200 export to vetted Chinese firms with proper licences, 25% tariffs, and US oversight. These overturned a ban that eroded Nvidia’s dominance in China. H200 complies with performance limits, unlike prohibited H100/H800 models. This reversal is aimed at reclaiming market share; the block undermines it.
This prohibition threatens Nvidia’s China rebound, potentially redirecting orders to indigenous chips and halting AI infrastructure. As per expert analysts, it is a negotiation tactic with no immediate resolution. Nvidia’s shares reduced by 1.2% in after-hours trading. Production is waiting for clarification from customs as H200 serves as an interim to 2026’s Rubin GPUs.
This incident highlights vulnerabilities in the US export policy and China’s self-dependency drive. It follows the US’s scrutiny of Chinese firms and reflects prior retaliations. Experts predict long-term uncertainty, urging diversification. Nvidia is still leading globally, but China’s exposure, once 26% of the revenue, remains decisive.
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