Nvidia refocuses TSMC capacity as export controls stall China sales

SemiconductorsAdd to myFTGet instant alerts for this topicManage your delivery channels hereRemove from myFTNvidia refocuses TSMC capacity as export controls stall China salesUS group moves production away from H200s intended for Chinese market to latest Vera Rubin productsNvidia’s Vera Rubin chip was unveiled earlier this year © Bridget Bennett/BloombergNvidia refocuses TSMC capacity as export controls stall China sales on x (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on facebook (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on linkedin (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on whatsapp (opens in a new window) Save Nvidia refocuses TSMC capacity as export controls stall China sales on x (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on facebook (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on linkedin (opens in a new window)Nvidia refocuses TSMC capacity as export controls stall China sales on whatsapp (opens in a new window) Save Zijing Wu in Hong KongPublishedMarch 5 2026Jump to comments sectionPrint this pageUnlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Nvidia has stopped production of chips intended for the Chinese market, betting that regulatory barriers in Washington and Beijing will continue to limit sales to China.The US chipmaker has reallocated manufacturing capacity at Taiwan Semiconductor Manufacturing Company away from making H200 chips to its next-generation Vera Rubin hardware, according to two people with knowledge of the matter.The move suggests Nvidia no longer expects significant H200 sales in China in the near term, after months of uncertainty over US export approvals and potential Chinese restrictions.The H200 is one of Nvidia’s older-generation AI processors and has been positioned as compliant with US export controls on advanced chips. Vera Rubin, unveiled earlier this year, is its latest chip architecture, designed for more complex AI systems and in strong demand from top US tech groups such as OpenAI and Google.The H200 chip © NvidiaWashington has tightened restrictions on the sale of high-end semiconductors to China, while Beijing has signalled it may curb imports to support domestic champions.“Instead of waiting in a limbo, Nvidia has to move on to what it can achieve with certainty especially when there’s a shortage of supply for its advanced stuff,” said one person with knowledge of the plans. “This could in a way accelerate the Vera Rubin delivery and roll out.”Nvidia had heavily lobbied Washington and Beijing to allow sales of its H200 chips in China. After US President Donald Trump indicated in December he would permit sales, Nvidia began stepping up production. The company had expected orders of more than 1mn units from Chinese clients, the FT has previously reported. Its suppliers had been working around the clock to prepare for deliveries initially planned for as early as March.Demand was “very high, and we’ve fired up our supply chain and H200s are flowing through the line”, Nvidia’s chief Jensen Huang said in early January.But the approval process stalled soon after, as the state department pushed for tougher restrictions to make it harder for China to use the H200 chips in ways that would undermine US national security. Jensen Huang, chief executive of Nvidia © Bridget Bennett/BloombergChina is also planning restrictions on purchases of H200s in order to protect its domestic semiconductor industry and to encourage local AI groups to use Chinese-made chips.While no details have been announced, the country’s customs still included H200s on its list of banned products, unless the importer has an approval letter from Beijing, people with knowledge of the situation said.“While small amounts of H200 products for China-based customers were approved by the US government, we have yet to generate any revenue,” Colette Kress, Nvidia’s chief financial officer, said on an earnings call last week. “And we do not know whether any imports will be allowed into China.” Nvidia has already produced about 250,000 H200 chips, according to a person with knowledge of the matter. If only limited orders are allowed by both American and Chinese governments, the existing stock should meet the demand, they added.China’s President Xi Jinping and Trump are due to meet at the end of March, leading some industry analysts to speculate whether an agreement could be reached to lift chip export controls.If so, it would take up to three months for Nvidia to reallocate or add supply chain capacity to produce H200s, the people with knowledge of the matter said. Its existing stock could also cover the demand and delivery during this period.Nvidia declined to comment.Additional reporting from Michael ActonReuse this content (opens in new window) CommentsJump to comments section Follow the topics in this article US companies Add to myFT US-China trade dispute Add to myFT Technology sector Add to myFT Semiconductors Add to myFT Asia-Pacific companies Add to myFT Comments