Nvidia has introduced a new restriction on Chinese customers, limiting their access to its artificial intelligence chips. The company is capping Chinese customers at 49% of sales for companies that rent out its chips, according to the Financial Times.
What happened
This unwritten rule, communicated to clients through verbal agreements, may restrict Chinese firms' ability to utilize chip power from American data centers to train their own AI models. Nvidia's move is seen as an effort to address concerns over the company's handling of China.
The rule applies to new contracts with Nvidia clients worldwide, and the company has also created a 'white list' to reduce its Asian clients by more than 50%. This development comes as Chinese tech giants, including ByteDance, Alibaba, and Tencent, have requested large quantities of Nvidia's RTX Pro 5500 chips, worth over $35 billion.
An Nvidia spokesperson stated that American policy has long encouraged data centers to run on US chips, which American AI companies rely on to compete globally. The spokesperson also mentioned President Donald Trump's push to rebrand AI as 'Super Intelligence', which was made official through an executive order.
