Nvidia shares rose slightly in premarket trading in New York after Reuters reported that the US chipmaker has informed customers it plans to ship its second-most powerful AI chip, the H200, to China before the Lunar New Year in mid-February.

Sources familiar with the shipment say Nvidia plans to deliver about 5,000 to 10,000 chip modules, equivalent to 40,000 to 80,000 H200 AI chips, to China in the coming months.

Those same sources noted that the chipmaker plans to expand H200 production capacity in the new year, with orders for that capacity scheduled to open in the second quarter of 2026.

Designed by Nvidia, the H200 AI chips are manufactured by Taiwan Semiconductor Manufacturing Company using its advanced 4-nanometer process. This is the same foundry that manufactures most of Nvidia's Hopper-generation GPUs.

Major Chinese tech firms, including Alibaba Group and ByteDance, are interested in the H200s for training large AI models. This chip offers about six times the performance of the H20.

However, the sources noted:

Significant uncertainty remains, as Beijing has yet to approve any H200 purchases and the timeline could shift depending on government decisions, the sources said.

"The whole ‌plan is contingent on government approval," the third source said. "Nothing is certain until we get the official go-ahead."

. . .

Chinese officials held emergency meetings earlier this month to discuss the matter ‍and are weighing whether to allow shipments, Reuters reported this month. One proposal would require each H200 purchase to be bundled with a set ratio of domestic chips, according to the report.

This report follows the Trump administration's approval of Nvidia's sale of H200s in China, but only on the condition of a 25% surcharge. The opportunity from the US Gov't will also be available to other chipmakers, such as Intel and AMD.

However, China's move to expand domestic production of advanced AI chips may be at odds with Western chipmakers trying to expand market share in the world's second-largest economy.

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