China may allow limited NVIDIA H200 sales to Alibaba, ByteDance and DeepSeek

China is reportedly considering a partial reversal of its own restrictions on NVIDIA AI chip purchases, a move that could allow major local technology companies to buy limited quantities of H200 GPUs. The Information reports that companies such as Alibaba, ByteDance and DeepSeek may be allowed to purchase NVIDIA chips, although the final number could be far lower than what these firms have requested.

The reported limit under discussion is around 200,000 H200 chips. That would be a meaningful number, but still less than half of the demand reportedly submitted by Chinese companies. The talks suggest that Beijing may be trying to balance two goals: reducing reliance on foreign hardware while still giving domestic AI firms enough compute capacity to remain competitive.

NVIDIA developed the H200 as a China compliant AI GPU after US export rules limited access to the company’s more advanced products. Even though the chip was designed to meet US restrictions, China later moved to restrict domestic purchases as part of its own push toward local alternatives. That created an unusual situation where both Washington and Beijing had placed limits around NVIDIA’s China business from different directions.

Beijing may be softening its stance because AI compute remains difficult to replace

China’s domestic AI industry still needs large amounts of accelerator hardware. US restrictions have made it harder for Chinese companies to access leading edge chips, while local alternatives remain behind NVIDIA in software maturity, availability and ecosystem support. That makes the H200 useful, even though it belongs to NVIDIA’s older Hopper generation.

NVIDIA CEO Jensen Huang previously said the company had received approval in China to sell chips to local firms. He also noted earlier that NVIDIA had not included China sales in its financial guidance, which shows how uncertain the market had become.

The wider context is important. China has been trying to strengthen its domestic chip industry while dealing with US export controls. At the same time, Chinese AI companies need powerful GPUs to train and run advanced models. If local hardware cannot fully meet demand, a controlled approval system for NVIDIA H200 purchases may become a practical compromise.

The report also follows broader concern in Beijing about advanced AI model capabilities. Reuters previously reported that Chinese officials were considering restrictions around advanced AI models, with cybersecurity capability among the issues being discussed. That suggests the government is not only focused on chip supply, but also on how AI systems are developed and deployed inside the country.

For NVIDIA, even limited China access would matter. China was once a major market for its data center products, and any approved H200 sales could support revenue. Still, the opportunity is restricted compared with what NVIDIA could have sold without export controls and local policy barriers.

The H200 is also no longer NVIDIA’s newest platform. The company has newer products in its roadmap, including Rubin chips expected to begin shipping later and Rubin Ultra planned after that. Some reports suggest parts of the Rubin Ultra rollout may face delays due to production constraints. Even so, China’s possible H200 purchases show that older NVIDIA hardware can remain valuable when access to newer chips is limited.

Nothing is final yet. If Beijing approves the purchases, it would not mean a full reopening of NVIDIA AI chip sales in China. It would be a limited policy adjustment shaped by supply needs, AI competition, and geopolitical pressure. For Chinese AI firms, however, even a restricted batch of H200 GPUs could help bridge the gap while domestic alternatives continue to develop.