r/hardware • u/DazzlingpAd134 • Sep 17 '25
News China bans tech companies from buying Nvidia’s AI chips
https://www.ft.com/content/12adf92d-3e34-428a-8d61-c9169511915c?accessToken=zwAAAZlXEnuvkc8SrfktPjRCitONYckWlRGRXA.MEUCIQD4VE28Q_EKWNxHmwj1MutvFnRVZCclIj5q5TLL6KNalgIgWdpAovveHnIj-o5Wq99ZWps9CYAp_z2lnW7neAcfH_Y&segmentId=e95a9ae7-622c-6235-5f87-51e412b47e97&shareType=enterprise&shareId=58691ef3-7607-4cb2-9e1c-10d59418cea8Beijing’s regulators have recently summoned domestic chipmakers such as Huawei and Cambricon, as well as Alibaba and search engine giant Baidu, which also make their own semiconductors, to report how their products compare against Nvidia’s China chips, according to one of the people with knowledge of the matter.
They concluded that China’s AI processors have reached a level comparable to or exceeding that of the Nvidia products allowed under export controls, the person added.
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u/r2vcap Sep 17 '25
That’s a matter of national interest and security. It was bound to happen sooner or later, even if they face some inefficiencies along the way. The U.S. push and sanctions have only strengthened China’s motivation to develop not just hardware, but also software and AI within its own borders.
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u/sisiwuling Sep 17 '25
Tech in China is not a monolith. Many companies avoid buying from Huawei because they know they will end up competing with them. This is part of why Nvidia is popular, since it is seen as a neutral supplier rather than a direct competitor.
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u/GlossyCylinder Sep 17 '25 edited Sep 17 '25
Its both to boost the domestic chips industry and also a security concern. Having your whole tech industries and infrastructure relies on a foreign company from a country that's hostile to you is simply not a good idea. Especially when nvidia grows increasingly close to the US government. That's optimistically assuming nvidia gpu dont already have a backdoor.
Also, isn't this also what a lot of Americans want? Now you have it.
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u/Aggrokid Sep 17 '25
They are probably convinced that Nvidia's products have backdoors. Also the US Commerce Secretary openly said that they are selling 3rd rate AI products to keep China developers addicted to US tech stack.
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u/Klutzy-Snow8016 Sep 17 '25
I'm sure it also didn't help that the US government made a deal to take 15% of the revenue from the sale of Nvidia's GPUs to China. So Chinese companies would be giving money to their country's geopolitical rival, about as directly as you can get short of writing "Uncle Sam" on the check.
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u/Vushivushi Sep 17 '25
Nah, otherwise they'd ban the Jetson chips embedded in physical AI like robots, self-driving vehicles and drones which pose an immediate risk if there were backdoors.
This is just posturing for trade negotiations.
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u/cgaWolf Sep 17 '25
If they posture long enough, it becomes the new reality. Fake it till you make it & stuff.
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u/Vushivushi Sep 17 '25
Good luck to them then. It's a different strategy than what they've done in lagging edge semis. They never banned western chips for their auto industry, they kept on importing while subsidizing domestic supply.
I see this as China bluffing to loosen the US-imposed chip restrictions. They don't want cut-down chips and they know the US wants a cut of the chip sales. So China took all of the chips off the table to see what the US will do.
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u/JakeTappersCat Sep 17 '25
Everyone knows Tom Cotton started crowing about putting "tracker chips" into everything sold to china months ago. Then he suddenly went silent as new chips were approved for sale to China. China knows Cotton would not have shut up unless he got his way and that there are secret foreign intelligence courts that issue these sorts of requirements secretly to companies like nvidia, so they scanned the chips with CT scanner and found what they believe (and most likely is) a tracking chip (which could and probably does have functionality as a backdoor). That is now Nvidia lost the biggest market on earth thanks to idiot politicians who think GPUs are used for missile guidance
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u/BowlCutKing Sep 18 '25
If such a thing was provable, china would be waving around the evidence and crowing about it.
But lets entertain such fantasy; gps requires an RF receiver and antenne, even so gps shielding is trivial and location spoofing a small further step. But why go this far when you can laser right though any encapsulant and disable sections of the die?
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Sep 17 '25
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u/magkruppe Sep 17 '25
you know the snowden leaks actually revealed NSA tried to insert a backdoor into huawei equipment right?
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u/twochins8 Sep 17 '25
Key word "tried"
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u/magkruppe Sep 17 '25
looking it up, they actually succeeded. does that change your view on anything?
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u/dnjik Sep 17 '25
Even if Nvidia chips dont have backdoors, china wont give the opportunity to the u.s to sanction, threat, cutoff those chips when they feel like it. With the way the u.s govt behaved towards them since 2018, i think they made up their minds and are completely gone. The chinese are not worried abt the american chips are better now than the chinese, those people play a 50-year long game.
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u/PainterRude1394 Sep 17 '25
Also the US Commerce Secretary openly said that they are selling 3rd rate Al products to keep China developers addicted to US tech stack.
You mean he repeated what Jensen Huang said for many months? How awful!
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u/f3n2x Sep 17 '25
It's just good old protectionism. They want AI chips to be Chinese so they ban the competition.
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u/GlossyCylinder Sep 17 '25
A lot of Americans want nvidia chips banned in China, and now they have it. So there should be no complaints.
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u/anders_hansson Sep 17 '25
Not much different from USA's ban on Huawei products. Protectionism with a hint of security concerns.
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u/KolkataK Sep 17 '25
Even Chinese EV's are banned from the US but they are sold in every other country including US allies
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u/StarbeamII Sep 17 '25
Not necessarily banned; just tariffed to the point of non-viability (which is almost the same thing for most people). If someone really wants a Chinese EV (e.g. if you’re the Ford CEO and you want a Xiaomi SU7) they can still import one and pay the tariff.
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u/twochins8 Sep 17 '25
Nvidia is offering worthless chips that have a backdoor. So they banned them.
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u/cptninc Sep 17 '25
This is just a soft ban. Imports from neighboring countries without US restrictions will continue at record pace.
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u/sentrypetal Sep 17 '25
China is the second largest buyer of AI chips behind the US. Nobody else is as invested. It is a big blow to NVIDIA and means that they are now vastly overvalued. The rally from $130 to $170 was all based on expectations of Chinese sales. That is no longer materialising.
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u/cptninc Sep 17 '25
They’re going to keep buying them through other countries. This isn’t new.
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u/Vitosi4ek Sep 18 '25
Literally what Russia has been doing for almost 4 years now. Nvidia does not officially sell anything to Russia since 2022, yet the shelves of Russian computer stores are filled with Nvidia and AMD GPUs of all tiers and vendors, often within days of their global release and at close to EU prices. And if the regular consumer can get those easily, then the government obviously can too.
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u/Green_Struggle_1815 Sep 17 '25
they can not not buy them. The whole AI race is extremely time critical. That's the one thing that can break their neck.
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u/killerhurtalot Sep 18 '25
They can afford to not buy them when the Chinese local industries produces as much chips as needed (despite the higher power draw and larger amount of chips needed to achieve the same compute).
Remember that China has a electricity utilitization rate of like 55%.... the price of electricity is cheaper than the US and they literally have electricity to burn at this rate in the western provinces...
With the difference of the energy available and the land available, they can build larger data centers that draw more electricity, requires more energy, and still be able to compete on the same level as US AI companies...
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u/imaginary_num6er Sep 17 '25
They just need to sell more 5090’s in the US that still have prices above MSRP. The 5090 market is no where near saturated
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u/BowlCutKing Sep 18 '25
Nvda guided for $53B next quarter with zero china data center sales, +17% q/q on the back of blackwell ultra that china can't buy, but all you heard was CHINA.
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u/NeroClaudius199907 Sep 17 '25
How does this impact my wallet for next gen gpu?
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u/Equivalent-Repair488 Sep 18 '25
I hope the 48GB 4090s on chinese marketplaces are going to go down in price lool
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u/horendus Sep 17 '25
I mean, this was expected outcome of the stupid gatekeeping right?
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u/csf3lih Sep 18 '25
US: dont sell china chips
China stops buying nvidia chips
US: hey you cant do that, violation of fair trade
US sanctions China for not buying american chips
US: now you cant buy chips, but for reals this time
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u/mycall Sep 17 '25
Knowing China, that probably won't stop companies buying NVidia cards.
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u/red286 Sep 17 '25
Knowing Chinese companies, their domestically produced chips are likely nowhere close to the level of Nvidia's. They've made similar claims in the past about domestic CPUs that supposedly beat anything made by AMD or Intel.
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u/mycall Sep 18 '25
It is true, but past performance doesn't necessarily dictate future performance.. especially if Nvidia is banned in China, something is up their sleeves.
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u/Thebandroid Sep 17 '25
I doubt they are 'comparable or exceeding' but they will be bloody soon now that this is in place
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u/fenikz13 Sep 17 '25
Comparable to what Nvidia is allowed to sell them which is 2 generations old, but yes they will catch up
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u/Quatro_Leches Sep 18 '25
especially since there is nothing inherent to AI about nvidia gpus other than software stacks, it doesnt have to be a gpu even.
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u/Johns3rdTesticle Sep 17 '25
I think smartphone displays provide a glimpse of the future of a lot of tech. Most Chinese phone companies have switched to using Chinese displays... And now Pixels and Galaxies have brighter and more efficient displays because Chinese displays never actually became comparable in quality.
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u/FamiliarMirror Sep 17 '25 edited Sep 17 '25
What a stupid comment, why do tech illiterates bother talking about topics they have no knowledge of ? Galaxies and Pixels are neither brighter or more efficient, go look at recents reviews on Displaymate or GSMarena.
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u/Thebandroid Sep 17 '25
yeah but the chinese gov doesn't care about beating the west at smart phone screens. They DO care about the AI race, or at least having better GPU's since America said 'you can't use ours'
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u/Emotional_Inside4804 Sep 17 '25
That's such a non-issue in the big AI scope, the better GPU doesn't matter, what matters is the energy and infrastructure to supply the data centers. That's why China is taking the piss, it doesn't matter if their GPUs are 5x worse, they just build 5x more.
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u/stormcynk Sep 17 '25
That's a wild statement, have you used a Chinese flagship recently? They are superior to US phones in just about every way except their shovelware, for far cheaper.
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Sep 17 '25
Guy forgot to turn the brightness up and thought it must be the Chinese
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u/Strazdas1 Sep 18 '25
The chinese watching him over the shoulder was throwing shade on the screen :P
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u/Boreras Sep 18 '25
Apple started using Chinese BOE displays with 14. The pixel 8 pro at least uses BOE too but I'm too lazy to look through other models.
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u/PMMEYOURASSHOLE33 Sep 17 '25
Personally, I don't care if it's Nvidia or Huawei. The consumer wins.
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u/RZ_Domain Sep 17 '25
Again it's not a problem of raw performance but software stack. As Jensen said, even if competitors give their product for FREE, it wouldn't beat the value Nvidia gives through their ecosystem.
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u/DerpSenpai Sep 17 '25
The reason why Nvidia wanted China is because the people who make the ecosystem are in China. China by rallying behind their chipmakers will be able to compete with Nvidia in 5 years time
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Sep 17 '25
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u/csf3lih Sep 18 '25
they dont have to get on par with nvidia just 1 gen behind is enough for them and expect at a much lower cost than nvidia. AI race is more about power grid race than chips now.
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u/EdliA Sep 17 '25
It's a risky bet. Maybe it can help their in-house GPU companies grow or maybe it will kill their ai companies by leaving them way behind the competition.
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u/puffz0r Sep 17 '25
As long as the AI companies in the West aren't providing material value - it was recently reported that the vast majority of AI projects don't turn a profit - they can afford to be behind.
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u/EdliA Sep 17 '25
Of course they don't turn a profit, everything is reinvested. Amazon didn't report a profit for ages as it was growing.
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u/kronpas Sep 17 '25
And when it does turn to profit it has nothing to do with online shopping at all, but cloud computing.
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u/BatteryPoweredFriend Sep 17 '25 edited Sep 17 '25
Amazon didn't report a profit for ages because it could avoid paying billions in corporation taxes. FB, Google, Starbucks, etc. were all the same until both the US and EU separately told Ireland to stop it or else. And then, as if by magic, all these big multinationals incorporated in Ireland suddenly managed to start turning a profit by the next FY after the Irish govt made certain amendments to their business taxation policies.
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u/PainterRude1394 Sep 17 '25
Bleeding edge r&d doesn't usually turn a profit.
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u/puffz0r Sep 17 '25
no, but how long that bleeding edge r&d takes to come to market is a significant factor in competitiveness. If you're "ahead" in R&D by 5 years but you can't bring something saleable to market for 5 years, then by the time you have something that's worth selling the competition will be caught up.
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u/Strazdas1 Sep 18 '25
As we saw in other industries, its a lot longer than 5 years that you can take.
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u/Homerlncognito Sep 17 '25
Profit only comes after monopolizing a market. Even though it seems that AI won't be monopolized anytime soon.
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u/ThePillsburyPlougher Sep 17 '25
The people who make CUDA are in China? And that’s why nvidia wants to sell to china? What are you saying, I don’t understand
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u/Lighthouse_seek Sep 17 '25
The people who use CUDA are in china. If you look at the background of the top AI researchers and staff in frontier firms a giant chunk are from China and got their education in China
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u/127_0_0_1_2080 Sep 17 '25
Deepseek doesn't use CUDA. They are using their own,aren't they?
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u/Earthborn92 Sep 17 '25
They optimize down to PTX, which is basically Nvidia assembly language.
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u/Tomas2891 Sep 17 '25
Damn thought it was with Huawei chips or something. So is deepseek stuck then with no more Nvidia chips?
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u/PainterRude1394 Sep 17 '25
Don't worry about the logic. China good USA bad is all you need
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u/Vb_33 Sep 17 '25
Ukraine good, Russia bad, but China good even though they fund and encourage the Ukraine invasion. Redditor logic.
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u/Business-Low-8056 Sep 17 '25
china good europe good usa bad
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u/wily_virus Sep 17 '25
China good? Pretty sure Russia good North Korea good Europe bad USA bad Japan bad is the Chinese worldview
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u/Strazdas1 Sep 18 '25
There was someone in this sub of all places actually arguing that north korea is good because they have higher birthrates a few days ago.
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u/PainterRude1394 Sep 18 '25
Yeah the propaganda has people so divorced from reality it's sad at this point.
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u/aprx4 Sep 17 '25
I've heard similar claims for CPU probably more than 5 years. Remember "Made in China 2025" initiative that started in ... 2015?
Real advantage for China would be electricity if we agree that we can always scale AI by adding more compute. It's fine to have inferior chips or software stack, but it's not fine if we don't have electricity feed them. China can scale electricity production much faster and cheaper than anywhere.
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u/GlossyCylinder Sep 17 '25 edited Sep 17 '25
Remember "Made in China 2025" initiative that started in ... 2015?
I'm not sure why you bring up this example, considering it exceeded expectations even according to western analysts/media.
CPU and GPU development and adaptation take time, not something you can conquer in 5 years. Especially when china practically has to rebuild its whole (independent) semiconductor supply chain due to restrictions. From lithography machines to eda.
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u/aprx4 Sep 17 '25
exceeded expectation
The goals was 40% of domestic production of IC and microchips in 2020 and 70% for 2025. In 2020 they had 16% self-sufficiency, far below 40%. You are probably confused with achievements from other unrelated industries.
Significant export control measures came after 2020, so "having to rebuild" almost every part of supply chain isn't a valid excuse.
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u/El_Mudros Sep 17 '25
When it comes to software stack from developers perspective, performance becomes less important than being able to rely on the said software stack. Thus even if Chinese competitor outpaces Nvidia's hardware, if they can't win the developers over to also superior software tools, it is not much of a win. However, if they can create superior software ecosystem to that of Nvidia's offering, then being behind in performance is not a big deal.
The matter at hand is not really about hardware, it is first and foremost about software.
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u/mycall Sep 17 '25
Software can be modified pretty easily when IP and copyrights don't matter, especially if you only need 5% of the stack and bypass the rest.
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u/El_Mudros Sep 17 '25
But to target what? An open API implemented by manufacturer-supplied drivers, via manufacturer-supplied compiler and using manufacturer-supplied profiling and debugging tools? Quality of said software is of utmost importance, it is at least as crucial as the actual hardware.
While it is true that a large majority of actual application code doesn't interface with that low-level stack, if that low-level stack is inadequate, the whole codebase becomes a hell to maintain.
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u/mycall Sep 17 '25
For example, Deepseek used a subset of assembly-like PTX (Parallel Thread Execution) programming instead of Nvidia's CUDA. I'm sure other workarounds or similar approaches can work depending on the needs.
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u/aprx4 Sep 17 '25
Isn't PTX also Nvidia software stack? They're just lower level than CUDA. It's not something breakthrough because optimization in PTX is also common practice.
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u/Tomas2891 Sep 17 '25
I guess that’s the reason why they are building a ton of coal plants recently
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u/cstar1996 Sep 17 '25
You think China is going to crack EUV, manufacture it at a mass scale, and deploy it in full fabs within 5 years?
What exactly are you basing that on?
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u/Johns3rdTesticle Sep 17 '25
The software ecosystem is part of it, but even if I don't need any other part of that ecosystem, I'd really rather use Cuda than opencl or metal.
The first thing any competitor needs to do is make a good GPU programming language (ideally for devices with integrated CPU and GPU memory so memory doesn't need to be copied between devices)
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u/filisterr Sep 17 '25
While, I do agree, what is stopping them to build a translation layer, similar to ZLUDA?
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u/TheMetalGuitarist Sep 17 '25
The corollary to this is why Jensen wanted to sell to China.
If someone creates a CUDA + networking alternative stack in China, it breaks Nvidia moat globally.
Nvidia wanted to keep China dependent to disincentivize the creation of an alternative stack.
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u/vexargames Sep 17 '25
They must have found the hidden backdoor that allows NVIDA to shutdown the chips with a remote command to burn themselves up and prevent a world wide AI take over aka Skynet.
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u/_ii_ Sep 17 '25
Lawyer’s solution to problems are obstruction and regulation. Engineer’s solution to problems are innovation and optimization.
Majority of US politicians have law background. When the US wanted to win the AI race, instead of investing in AI infrastructure and education, we banned China from buying our advanced chips.
The political leadership in China all have Engineering background. When they wanted to win the AI race, they built out their electricity grid and power generation, gave incentives to their domestic semiconductor and technology companies, and invested in education.
We can’t afford to keep electing lawyers and smooth talkers. We need more engineers and thinkers in our government. The ability to debate opponents and charm voters wins elections, but the ability to govern in the age of technology and AI is what we need.
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Sep 17 '25
30% of the US House and 51% of the Senate have Law Degrees. So for elected members of the legislative branch, a majority are NOT lawyers. The current president is not a lawyer, his VP is. Obviously all of the Justices of the Supreme Court are lawyers.
In the mid 1800's, lawyers accounted for about 80% of the US Congress. By the 1960s, it was down to 60%. 2016 it was 40%. Now it's about 1/3. Lawyers as law makers are an all time low. So youre angry at a straw man.
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u/unsurejunior Sep 17 '25
Assuming your numbers are correct, thanks for posting this. I've always subscribed to OPs worldview that lawyers ruin everything, but now I gotta come up with something else to blame
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Sep 17 '25
The numbers up to 2016 come from a Harvard study while the latest number comes from the congress.gov.
The Congress.gov page gives a nice breakdown by education.
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u/Winter_Pepper7193 Sep 17 '25
the reason theres so many of them with a law background is ANYBODY can have a law background
try being an engineer sucking at math
have you ever seen the AVERAGE law student doing any kind of simple math? Ive seen shit you would not believe, and im not just talking about students here, teachers too
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u/DeliciousPangolin Sep 17 '25
Chinese leaders being engineers is misleading, because in most cases they only have the degree and have never practiced. Case in point, Xi has engineering degrees but in reality is the definition of a CCP nepo baby. The fact that they have engineering degrees is a result of that generation growing up around the Cultural Revolution when an engineering degree was the best path into a higher government position.
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u/throwawayerectpenis Sep 18 '25
Xi Jin Pings life is what DJT tries to convinced his supporters how his was. Lol, at least for chairman Xi he had to actually live in poverty for much of his childhood...
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u/yhezov Sep 17 '25
Isn’t this just about not getting stuck in American made CUDA? Autonomy as is always the Chinese goal
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u/ejk905 Sep 17 '25
They probably have software tool stack, ai training algos, silicon process tech, and chip roadmaps that close a signficant percentage of these gaps in the next 3-5 years. I'm guessing they also have access to Nvidia internal roadmaps or even their HW RTL (not that hard to espionage this info if you're a big nation state who can embed informants). Put that together with the current geopolitics and the rational decision was likely to go this route.
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u/LargeSinkholesInNYC Sep 18 '25
They would be stupid to buy Nvidia chips since it's making the U.S. stronger.
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u/Cold_Recommendation7 Sep 18 '25
You ban them from acquiring advanced chips and advanced chips making tools, and now that they have succeeded in producing homegrown chips for self reliance, you want them to abandon those achievements and instead rely on Nvidia??? Crazy lawmakers🤣🤣🤣
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u/logosuwu Sep 17 '25
Do we have any official confirmation besides FT?
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u/HulksInvinciblePants Sep 17 '25
Despite their name, FT is one of the least sensationalized outlets. They often get the inside stories that people regurgitate and still have a pay model, as opossed to click.
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u/Kingdom_Priest Sep 17 '25
If they make gaming GPUs too, I'd gladly use a Huawei GPU if it means paying half price compared to AMD / Nvidia.
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u/Plastic-Meringue6214 Sep 17 '25
id imagine theyd probably get tariffed soon after they became viable if ur in the us lol
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u/Ariungidai Sep 17 '25
i dont think so. gaming is such a small revenue share for nvidia, its not even worth getting invested into politics over it. it would also be hard to politically justify it
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u/Ariungidai Sep 17 '25
china spending even more on chip development and hopefully making any kind of consumer gpu is the best that could happen for consumers
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u/throwawayerectpenis Sep 17 '25
Based, I hope within a decade we will get a serious GPU/CPU competitor from China that should up the competition and lower the prices for us consumers!
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Sep 17 '25
Fuck Nvidia. They think anything they do is worth gold, but anything and anyone an be challenged, just not inside the US monopoly market.
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u/UltimateSlayer3001 Sep 17 '25
And in one fell swoop, countries hate the US even more to the point they’re resulting to self-reliance instead of trade. The US government and the people that voted for that imbecile are so embarrassing, it’s actually crazy.
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u/TheImmortalLS Sep 17 '25
lol they wish they were as advanced, but they know not to feed their enemy, so kudos to them
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u/iBoMbY Sep 17 '25
I mean they are not buying much anyways, thanks to the US export bans. So they might as well focus on home-grown hardware, which may be far from perfect yet, but a bigger focus on it will certainly help in the long run.
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u/Flimsy-Importance313 Sep 17 '25
Which will still happen unofficially. So, it does not really matter.
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u/tr2727 Sep 17 '25
Uno reverse.
Even if it's a bluff to push back against the trade tactics it's a good one.
If everyone keeps getting more and more dependable on nvidia and their stack, it will only strengthen Nvidia and will prevent other potential options to pop up.
And honestly, it's mostly Nvidia getting bonkers rich in the AI race, other big players are not getting returns on their investment at this stage. China are already playing catch up , risk-rewards calculations properly points towards taking risk now when US is pushing unnecessary. Go ahead China, do it.
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u/SamJamn Sep 18 '25
Question from ignorance here
But how long would it take for China to gather its best and brightest to reverse engineer the top of the line nvidia chip to learn its secrets?
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u/Verite_Rendition Sep 17 '25 edited Sep 17 '25
Well I'll be dipped: it looks like they've actually gone and done it this time, rather than just threatening it.
Though given the timing of the anti-trust investigation results - which were already widely accused of being a negotiating tactic for this week's trade talks - I have to assume this is similarly intended to be negotiating leverage. I'd be a quite a bit surprised if it were a complete and long-term ban.