Nvidia AI Chip Sales in China Faces Expert Worry

Nvidia AI chip sales in China may be on the verge of a surprising reversal. But the story behind that opening is raising uncomfortable questions about who is shaping American technology policy, and it's doing so at a moment when the answer matters more than the reversal itself. China is reportedly considering relaxing controls. Those controls would let some of its largest AI companies import millions more of Nvidia's banned chips over the next year. We can't know yet how it ends.

The shift follows a summit between President Donald Trump and China's president, Xi Jinping, that on its face changed almost nothing about AI regulation. Export controls were not discussed. Neither country showed interest in concessions. An already shaky trade truce was extended for just two months, and looming US controls could end it and trigger Chinese retaliation through rare earth export cuts, analysts expect.

Yet behind the scenes, Nvidia appears to have scored a major win. China's tech oversight arm, the Ministry of Industry and Information Technology, asked Alibaba and ByteDance to share plans to buy Nvidia's RTX Pro 5500 chips, which are gaming chips, but China asked the firms to detail how they plan to use them. They're gaming chips. And expectations are that the chips could be put into servers to help power the country's most in-demand AI models.

Beijing Signals It May Open the Door

China intends to allow at least some of the gaming chips into the country. But final approval remains unclear. The pressure to say yes is real. Chinese companies are rolling out AI products and services faster than they can find the chips to run them, and that gap between what they're building and what they can power is exactly why the push to let these chips in keeps growing louder.

If China gives the nod, ByteDance plans to order 1 million chips. That's huge. That figure would automatically secure two quarters of projected sales for Nvidia, a company that's watching this deal closely. At least one buyer plans to put eight RTX Pro 5500s in each server, a standard setup that lets the chips work together on larger AI models, and that's the kind of arrangement you don't see every day. So Nvidia is supposedly preparing to ship the first orders this December.

That would be a meaningful rebound. China's delayed approval of H200 sales meant Nvidia's sales there were dismal, comprising less than 1 percent of its data center revenue in the most recent quarter.

How Jensen Huang Became Trump's Tech Adviser

Since Trump took office, opening more of China's market has been a central goal for Nvidia. Jensen Huang, the CEO, has blamed US export controls. They've cut Nvidia's share of China's advanced AI chip market from about 95 percent to zero, and he doesn't hide his frustration. The market's gone.

Trump was not an instant ally. He entered office asking "What the hell is Nvidia?and initially tightened Biden-era export controls even more, most prominently by banning exports of H200 chips to China. He was even thinking about breaking Nvidia up, expecting that more domestic competition among chipmakers was a must for winning the so-called AI race with China.

Then he met Huang over dinner at Mar-a-Lago. Trump said he "learned the facts of life" and understood that Nvidia is an "amazing" AI leader. Ignoring warnings from lawmakers and national security experts, Trump lifted the export controls on H200 chips, which China eventually allowed to be sold to some firms.

Since then, the two have appeared together in public repeatedly and talk regularly by phone, according to Stephen Witt, author of The Thinking Machine: Jensen Huang, Nvidia, and the World's Most Coveted Microchip.

"Jensen is now the president's most influential adviser on technology issues. The two have become quite close."

Witt told NPR that Trump's recent claims, suggesting it is a "hoax" that AI might destroy humanity and that AI will instead be an economic boon, are "exactly Jensen's talking points."

The Safety Debate Nobody Wants to Have

Witt spent time with "tons" of people in the AI industry. They share Huang's views. Like Huang, they tend to downplay risks that software developers, including Nvidia's biggest customers like Anthropic and OpenAI, are urging the White House to take seriously. And it's a pattern. They don't take those warnings seriously.

"Most of the hardware people, most of the people who designed the networking equipment and the microchips, feel like Jensen does. They tend to have a very low sense of risk regarding this technology. They just don't see it."

That debate has been running for the past 10 years, Witt said, and neither camp has moved at all.

Treasury Secretary Scott Bessent confirmed ahead of Trump's talks with Xi that "the president is completely aligned with Jensen Huang, the CEO of Nvidia."

Critics See Profit Steering Policy

Andrew Yoon, a researcher at an AI safety nonprofit called CivAI, told CNBC that in the AI industry, "Nvidia is the most aggressive in terms of, let's just make money."

"At every turn, they are really trying to just make sure whatever happens is good for Nvidia's bottom line."

Some experts fear the worst. If the US and China keep loosening controls, too many chips may end up diverted to China, and that's a problem they're watching closely because it's not something we've solved yet. So what happens next? Eventually, that could cause US data centers to lose a domestic chip supply that currently makes it possible to stay ahead on frontier AI, and once that supply is gone, they can't just get it back overnight. But the fear is real.

Nvidia's own reporting suggests something simple. These countries don't compete for resources right now. In the first half of 2026, Nvidia reportedly took a $400 million hit because it was stuck with vast quantities of unsold H200 chips that nobody in America wanted, since American firms can already access Nvidia's more advanced products whenever they need them. No American firms want those chips. But demand for chips made for China's market could change as more US data centers come online, policy experts believe, and that shift in demand is something the company will be watching closely.

Nvidia's spokesperson told Ars that if China lifts curbs on "outdated" gaming chips "released nearly a half a decade ago," it will only benefit US firms unfairly burdened by restrictions on chips that cannot be used to train AI.

A Promise, and a Wink

That statement recalls Huang's remarks. They came at a recent "All-In" summit. Trump's former AI czar, David Sacks, hosted it. And Huang didn't hold back. He publicly promised Trump something big, telling him that "we're going to make sure that everybody wins in the AI race of America," a promise he then stretched across every industry, every company, every state, and every people.

Witt joked that "Jensen is really the only one who wants to sell his equipment to China."

He thinks a responsible US president would set up a group like the National Transportation Safety Board to review mandatory reports of AI safety incidents, and that kind of body, in his view, could support the US-China safety alert system announced last week, which right now includes no tech experts. That won't happen. Jensen has convinced Trump. "What's good for Nvidia is good for America," Witt said.

Where the Two Leaders Actually Agree

China invited none of its tech leaders.

Neither country was willing to make even a symbolic gesture that an AI slowdown may be necessary if risks cannot be contained.

Distillation, and the Limits of Loyalty

Trump may soon have to reconcile Huang's views on AI safety with his own law enforcement.

To Huang, getting Trump to agree might be easy, Witt suggested. Study the inputs, then modify them to get the outputs you want.

Witt says Jensen figured out the inputs. They're public flattery, nonstop, aimed at Trump. And the outputs? Lifted restrictions on Nvidia equipment sales to China, plus zero regulation on AI, which is exactly the kind of trade a guy like Jensen can't resist making when the man in the Oval Office responds to praise the way he always does.

Despite Bessent's suggestion that Huang is pulling the strings,

It's still unclear if China approves. If Huang gets his way, Chinese firms will buy millions more of Nvidia's chips in the coming years, which would help the firm maintain global dominance over companies locked in on advancing AI. But does that outcome serve American interests? The president has shown little appetite to ask.