The United States Commerce Department has begun issuing licenses to Nvidia to export its H20 chips to China, a US official told Reuters on Friday, marking a major breakthrough for the AI giant’s access to one of its most important markets.The move follows Washington’s decision last month to reverse an April ban on sales of the H20 chip to China. Nvidia had designed the processor specifically to comply with Biden-era AI chip export rules. The restrictions were expected to wipe $8 billion off its July-quarter sales, the company had warned.Nvidia CEO Jensen Huang met with US President Donald Trump on Wednesday, two sources familiar with the matter told Reuters.In July, the company said it was applying for licenses to resume H20 sales and had been assured of speedy approvals. It remains unclear how many licenses have been granted, which Chinese companies can receive the chips, or the total value of approved shipments.Nvidia previously disclosed a $5.5 billion hit from the export curbs but later revised the figure down by $1 billion after reusing some materials. The H20 alone generated $4.6 billion in first-quarter sales, with China accounting for 12.5% of the company’s overall revenue.The company has denied Chinese claims that the H20 poses national security risks, insisting the chip contains no “backdoors” for remote access. “Cybersecurity is critically important to us. NVIDIA does not have ‘backdoors’ in our chips that would give anyone a remote way to access or control them,” a Nvidia spokesperson earlier said in a statement.CNBC reported that China’s Cyberspace Administration (CAC) has asked Nvidia to “to clarify and submit relevant supporting documentation regarding security risks, including potential vulnerabilities and backdoors, associated with its H20 computing chips sold to China.”The regulator said Nvidia’s AI chips have been reported to contain serious security flaws and noted that some US lawmakers are pushing for mandatory tracking features on advanced chip exports.Other high-end Nvidia AI chips remain barred from sale to China under longstanding US export controls aimed at slowing Beijing’s AI and defense advancements.Huang has warned that Nvidia’s industry leadership could be at risk without access to the Chinese market, where domestic rivals like Huawei are rapidly expanding their chip offerings.
