Nvidia Orders Halt to H20 Production After China Directive Against Purchases

Nvidia has told some of its component suppliers to suspend production work related to the H20, its chip tailor-made for the Chinese market, according to two people with direct knowledge of the communications. The directive comes weeks after the Chinese government told local tech companies to stop buying the chips due to alleged security concerns, The Information previously reported.

The production halt signals that despite the Trump administration’s decision to allow Nvidia to resume selling the chips after a monthslong ban, the chip giant’s hopes of maintaining its foothold in the Chinese market remain in limbo—now because of the Chinese government’s policies. Chinese authorities fear Nvidia’s chips could contain backdoors that funnel sensitive data from China to the U.S., The Information previously reported. As a result, Chinese authorities are encouraging local companies to use Chinese-made AI chips, such as those sold by Huawei.