Beijing rejects all H200 AI chip orders following Trump’s 25% tariff reduction, wiping out $30 billion in potential Nvidia revenue.
Nvidia’s stock dropped 4.4% after President Donald Trump revealed China has refused to approve any purchases of the company’s H200 AI chips. The decision follows a 25% tariff cut on Nvidia chips sold to China, intended to boost sales but instead prompting Beijing to prioritize domestic alternatives.
Earlier this week, the U.S. Commerce Department approved sales of up to 75,000 H200 chips each to 10 Chinese firms, including Alibaba and Tencent, capping potential revenue at $15-$20 billion. Analysts had projected annual Chinese demand at 1.5 million units, or roughly $30 billion, but the blockade suggests a permanent shift away from U.S. suppliers.
The rejection underscores escalating tech tensions, with China accelerating its push for self-sufficiency in semiconductor production. Nvidia’s shares erased gains from a prior all-time high, signaling investor concerns over long-term revenue growth in its second-largest market.