Nvidia AI chips worth $1B smuggled into China after Trump imposed US export controls: report

Core Insights - At least $1 billion worth of Nvidia computer chips were smuggled into China following the imposition of export controls by the Trump administration [1] - The B200 chip, favored by major US tech firms for AI applications, is banned for sale to China due to performance threshold regulations [1][5] - Chinese suppliers continued to sell Nvidia chips, including the B200, to data center operators supporting local tech firms despite the export restrictions [2][6] Group 1 - A Chinese data center operator indicated that export controls have not effectively prevented advanced Nvidia products from entering China, instead creating inefficiencies and profits for middlemen [3] - The Trump administration had previously banned Nvidia from selling the less powerful H20 chips, which were designed to comply with earlier export controls [3] - Nvidia's CEO revealed that Trump reversed the ban on H20 chip sales to China, leading to speculation about Chinese companies circumventing export controls [4][7] Group 2 - Evidence reviewed by the Financial Times indicated that Chinese distributors in Guangdong, Zhejiang, and Anhui provinces sold restricted Nvidia chips, including the B200, H100, and H200 [6] - There is no evidence that Nvidia was involved in or aware of the illicit sales to Chinese entities, as the company maintains compliance with US laws [6] - Nvidia stated that assembling data centers from smuggled products is technically and economically unfeasible, emphasizing the need for authorized products and support [8]