The fight over AI chips just turned into a straight-up chess match, and Trump’s own top AI guy David Sacks thinks China is already many moves ahead.
He said China and Xi Jinping have figured out the US plan behind letting them buy Nvidia’s H200, and he said they are now turning the chip down while they double down on their own semiconductors.
David based that on news reports he read as the White House pushed a plan backed by him and Donald Trump to let H200 shipments reach China in an attempt to challenge firms like Huawei on their home turf.
He also admitted on Friday that he was not sure the plan would work. He said, “They’re rejecting our chips,” and added that “apparently they don’t want them, and I think the reason for that is they want semiconductor independence.”
China sets limits on H200 access
David posted on social media that his comments were tied to a Financial Times report saying China was preparing a local approval process that would force buyers to justify H200 purchases.
That move raised questions about whether Nvidia can recover any China-related revenue now that the firm removed the market from its forecasts, even though Jensen Huang put the value of China’s data-center demand at $50 billion for this year.
Bloomberg Intelligence said H200 sales could reach $10 billion there, but only if China actually accepts the chips, which at this point is not happening.
Nvidia sent a statement saying it is still working with the administration to secure H200 licenses for vetted buyers. The company said, “While we do not yet have results to report, it’s clear that three years of overbroad export controls fueled America’s foreign competitors and cost US taxpayers billions of dollars.”
A spokesperson for China’s embassy, Liu Pengyu, said cooperation in tech and the economy serves both sides and added, “We hope the US will work with China to take concrete actions to maintain the stability and smooth functioning of global supply chains.”
Cryptopolitan had reported that China is considering up to $70 billion in incentives for its chip industry. That plan shows Beijing’s push to reduce its dependency on foreign firms and keep backing companies like Huawei and Cambricon Technologies even though Washington cleared the H200 for export.
The H200 itself came out in 2023 and began shipping last year. It sits inside Nvidia’s Hopper line, behind Blackwell, and two generations behind the Rubin chips coming up next. The White House said its lag, around 18 months, was one reason it allowed China to access it.
Sacks ties China’s reluctance to Huawei support
David said China wants to support Huawei, and that explains its reluctance to take H200 chips. He still defended the idea of letting China buy the older chip, calling it “lagging” and “not the best.” He said, “What you see is China’s not taking them because they want to prop up and subsidize Huawei.”
David said selling weaker chips was part of the plan to cut into Huawei’s market share, but he now thinks “the Chinese government has figured that out, and that’s why they’re not allowing them.”
David added that the decision was shaped by US views that Huawei’s AI systems can rival Nvidia’s in raw output. Huawei’s Cloud Matrix 384 links hundreds of processors together to offset weaker power in each unit.
Some officials saw H200 access as a compromise after Nvidia tried to export a version of Blackwell to China earlier. As officials debated the move, Jensen Huang told reporters he had “no clue” if China would accept H200 chips. On Monday, Trump said Xi Jinping gave a positive response to possible approvals on Truth Social.
China has not publicly agreed to import H200 chips, and it has not formally rejected them either. Earlier this year, Beijing turned down the H20, a weaker chip that Trump allowed into the market in the summer.
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