China is now raising concerns about potential security risks in Nvidia’s H20 artificial intelligence chip. This creates a cloud of uncertainty over the U.S. company’s sales prospects, just weeks after a U.S. export ban on the chip was lifted.
The country’s top internet regulator, the Cyberspace Administration of China, said it is worried about a U.S. proposal to put tracking features on advanced chips sold abroad.
The regulator summoned Nvidia to a meeting on Thursday, demanding the company explain whether its H20 chip has any “backdoor” security risks. Officials are concerned that Chinese user data and privacy rights could be compromised.
This new pressure from Beijing comes at a tricky time for Nvidia. The U.S. government only recently reversed an April ban on H20 sales. The company designed the chip specifically for the Chinese market and, due to strong demand, has reportedly already placed new orders for 300,000 chipsets.
While some analysts believe the move is largely symbolic—a way for Beijing to push back against U.S. pressure—it adds to Nvidia’s challenges in the country. The chipmaker is already facing a separate antitrust investigation in China.
For now, Nvidia’s products are still highly sought after by Chinese tech companies. Still, this new scrutiny shows that Beijing may feel it has more leverage than in the past to push back on U.S. tech.
