July 21, 2025: NVIDIA Corporation has informed Chinese customers that it has limited inventory of its H20 artificial intelligence chip, citing uncertainty over U.S. export licensing. The update comes despite earlier expectations that Washington would ease restrictions on chip sales to China.

The H20, which is NVIDIA’s most powerful AI chip currently permitted for export to China, has been in high demand among Chinese technology firms. However, according to a report by The Information, the company does not plan to restart production of the chip in the near term and has notified its Chinese partners about tight supply conditions.

This announcement follows a statement by NVIDIA last week indicating that the U.S. government would issue new licenses to allow resumed shipments of the H20 to Chinese clients. As of now, no formal confirmation or policy update has been issued by Washington, raising further uncertainty for both the company and its customers in China.

The H20 chip was previously cleared for sale in China under the Biden-era export control regime, which sought to limit the transfer of high-performance AI hardware to strategic competitors. However, these restrictions were further tightened earlier this year under the Trump administration as trade tensions between the U.S. and China escalated.

Despite the regulatory shift, relations between the two economic powers showed signs of softening through May and June. During this period, Beijing resumed shipments of rare earth minerals to the United States, while the U.S. reciprocated by easing some restrictions on the export of chip design tools and electronic materials.

NVIDIA’s announcement regarding the limited availability of the H20 chip underscores the fragility of U.S.- China tech trade ties and the significant operational impact that shifting export regulations can have on semiconductor companies. The chipmaker, which has been a central player in the global AI boom, is navigating an increasingly complex geopolitical environment, particularly in managing supply chains and customer expectations in restricted markets like China.

Industry analysts believe that even if Washington reissues licenses in the coming weeks, NVIDIA’s current decision not to ramp up production of the H20 may reflect a strategic pivot. The company could be relocating its resources toward next-generation products that comply with evolving export control frameworks or are better suited for other global markets.