NVIDIA Corporation has reportedly asked leading chip manufacturer Taiwan Semiconductor Manufacturing Company (TSMC) to halt production of certain chips intended for the Chinese market, as U.S. export restrictions continue to affect the company’s sales in China. The development was reported by the Financial Times on Thursday.
According to the report, Nvidia has begun redirecting part of its manufacturing capacity at TSMC away from its H200 artificial intelligence chips and toward its upcoming next-generation Vera Rubin hardware platform. The decision was based on information from two sources familiar with the matter.
The move suggests that Nvidia no longer expects significant demand for its H200 chips in China, particularly as uncertainty grows around U.S. export rules and increasing regulatory resistance from Chinese authorities.
Earlier in December, U.S. President Donald Trump indicated that Nvidia would be allowed to sell its H200 chips in China. Although the H200 is not Nvidia’s newest processor, it remains the most advanced artificial intelligence chip the company is currently permitted to sell in the Chinese market under existing U.S. export regulations.
However, sales momentum in China appears to have weakened. Several U.S. lawmakers have called for tighter restrictions on how Chinese companies can use Nvidia’s AI chips, raising concerns about potential national security risks.
At the same time, China has been pursuing a broader strategy aimed at achieving greater technological self-sufficiency in the artificial intelligence sector. As part of this effort, Chinese regulators have reportedly increased scrutiny of foreign chip suppliers, including Nvidia.
The combination of U.S. export controls and China’s push for AI independence has created a challenging environment for Nvidia’s operations in the region, prompting the company to adjust its production strategy and focus more heavily on its next generation of AI hardware.
