Nvidia AI Chips Surpass U.S. Export Controls and Enter China
Background on U.S. Export Curbs
The United States government imposed strict export controls on advanced AI chips in 2022 and 2023, aiming to restrict China's access to high-performance computing components, primarily for national security reasons.
Nvidia, the world’s leading maker of AI chips, was directly affected by these regulations, which were designed to limit the export of powerful semiconductors used for
ChatGPT and other cutting-edge artificial intelligence tools.
Findings on Chip Shipments to China
According to a report by the Financial Times on July 24, 2025, Nvidia AI chips valued at around $1 billion have entered the Chinese market since October 2023, despite the U.S. export controls. These chips include several banned or restricted models that have reached Chinese buyers through alternative routes and distribution networks.
How the Chips Entered the Chinese Market
The Financial Times’ investigation revealed multiple pathways through which the chips reached China:
- Indirect exports via third-party countries
- Use of grey market dealers and unauthorized resellers
- Smuggling or “parallel imports” circumventing official channels
The investigation found that some companies bought large batches of Nvidia AI chips in countries not subject to the same strict export laws and then rerouted them to Chinese clients.
Official Responses and Impact
Nvidia stated that it strives to comply fully with U.S. export laws. The U.S. Commerce Department, responsible for enforcing semiconductor controls, acknowledged the continuing challenge of enforcing restrictions, especially given the high global demand for AI chips.
The influx of these chips supports China’s domestic technology firms and AI initiatives, potentially undercutting U.S. efforts to slow China’s advances in artificial intelligence and supercomputing. It also highlights the persistent demand for high-performance chips required for innovations in AI models like
Claude and
GPT-4.
Ongoing Developments
The revelations may prompt renewed scrutiny and regulatory tightening from U.S. authorities, as well as possible diplomatic discussions between the U.S. and China regarding their respective technology sectors. Both governments have yet to release follow-up statements after the FT’s findings.
For further details, view the full
Reuters article here.
