Nvidia Implements Upfront Payment Policy for Chinese Customers Purchasing H200 AI Chips
Nvidia has announced a new policy mandating that its clients in China pay for H200 AI chips in full upfront, amidst ongoing uncertainties regarding regulatory approvals from both the U.S. and Chinese authorities, according to Reuters’ sources. This decision marks a significant shift from previous practices, as customers will not have the option for refunds or modifications to their orders.
Key Highlights:
– Clients may be permitted to utilize commercial insurance or asset collateral; however, these terms are notably stricter than prior agreements, which occasionally allowed for partial deposits.
– While Nvidia did not provide a comment, reports suggest that Chinese regulators are likely to grant permission for the sale of H200 chips, albeit with restrictions aimed at preventing their use by military entities, state-owned enterprises, and in sensitive infrastructures.
Despite regulatory hurdles, the demand for Nvidia’s H200 remains robust, with Chinese firms reportedly placing orders for over 2 million GPUs slated for delivery in 2026. This strong demand has prompted Nvidia to increase production capacity.
Nvidia is navigating a complex landscape as it seeks to fulfill demand for its advanced chips while managing the political risks associated with trade relations between the U.S. and China. The company previously faced significant financial challenges when the Trump administration imposed licensing requirements for exporting its H200 chips to China, leading to a write-down of $5.5 billion in inventory.
