US lets Nvidia fuel China’s AI boom to skim from the top

The Trump administration will allow Nvidia to sell high-end chips to China so that it can continue its domestic AI development unabated with hardware that is miles better than anything it can currently muster on its own.

Nvidia will only have to cut Uncle Sam a 25% check for the permission to export H200 AI chips, which, given that the permission could rake in $5 billion of revenue a month, wouldn't be a problem.

The H200 generation precedes Nvidia's latest Blackwell architecture, but it is still a very capable AI chip that outperforms anything China-made, including the Huawei Ascend 910C. Given that China's limited AI hardware resources forced it to choose open-sourcing and token optimization instead of raw LLM power, with the H200 it can achieve what the Silicon Valley juggernauts do with Nvidia Blackwell.

Its most popular Doubao chatbot is breathing down Google Gemini's neck when it comes to daily tokens, relying on less powerful but more numerous clusters of AI chip hardware. Huawei also found a software solution that brings a massive increase in cluster productivity, while domestic AI models like DeepSeek can now scan and process 200,000 pages a day on a single Nvidia A100 card.

While some experts and lawmakers scoffed at the H200 export permit on national security grounds, Nvidia lobbied Trump, and rather successfully at that, saying that Chinese money will help it develop the next-gen AI chips that it will only get when they get long enough in the tooth.

China, on the other hand, has seen promising signs from its indigenous chip industry from Huawei and others and is looking for ways to restrict foreign chip imports, so it remains to be seen how many billions the H200 export permit will bring for Nvidia and the US government.

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