[News] NVIDIA Reportedly Tightens H200 Payment Terms Despite Possible Q1 Approval from China

NVIDIA is facing mounting uncertainty in China, with the administration reportedly asking local firms to suspend orders for its H200 AI chips. According to Central News Agency, citing The Information, sources say Beijing authorities this week instructed some Chinese technology companies to halt purchases of the H200 and may also require them to shift toward domestically produced AI chips.

Meanwhile, Bloomberg reports that Beijing is weighing a partial approval that could allow limited imports of the H200 as early as this quarter, according to sources. Under the plan, Chinese officials are said to be preparing to permit purchases for select commercial uses, while barring the chips from the military, sensitive government agencies, critical infrastructure, and state-owned enterprises. However, it remains unclear how Beijing will ultimately define “critical infrastructure,” beyond more obvious areas such as military or government networks.

Against this backdrop of policy uncertainty, Reuters, citing sources, reports that NVIDIA is now requiring Chinese customers seeking its H200 AI chips to make full upfront payments, reflecting heightened uncertainty over sales approvals in China.

NVIDIA Reportedly Tightens H200 Payment Terms Amid Regulatory Uncertainty

Reuters says NVIDIA has imposed unusually strict sales terms for its H200 AI chips, requiring full upfront payment for orders with no option to cancel, request refunds, or change configurations once placed. In certain circumstances, customers may be allowed to substitute cash with commercial insurance or asset-backed collateral, the report says.

While NVIDIA has long required advance payments from Chinese buyers, it has at times permitted deposits instead of full upfront payment. For the H200, however, the report notes that the company has taken a notably tougher stance, amid lingering uncertainty over whether Chinese regulators would approve the shipments. As Reuters points out, these payment terms effectively shift financial risk from NVIDIA to its customers, who must commit capital without assurance that Beijing will clear the chip imports.

H200 Reportedly Sees Strong Demand in China

NVIDIA is reportedly seeing strong demand for its H200 chips in China. As Reuters notes, CEO Jensen Huang said on Tuesday that customer interest in the H200 is “quite high” and that the company has “fired up our supply chain” to boost production. Reuters adds that Chinese tech companies have ordered more than 2 million H200 chips, each priced at about $27,000, exceeding available inventory of roughly 700,000 units.

To support near-term deliveries, the U.S. chipmaker plans to fulfill initial orders using existing inventory, with the first batch of H200 chips expected to arrive ahead of the Lunar New Year holiday in mid-February, Reuters notes. Looking further ahead, the company has approached TSMC about ramping up H200 production to meet demand from China, with orders for the additional capacity expected to open in the second quarter of 2026, according to sources cited by the report.

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(Photo credit: NVIDIA)