China has provisionally approved its leading AI startup, DeepSeek, to purchase Nvidia's advanced H200 artificial intelligence chips, marking a significant step in the ongoing global AI supply chain dynamics. The approval, granted by China's industry and commerce ministries, clears a major regulatory hurdle, though final conditions set by the National Development and Reform Commission are still being finalized, preventing any immediate shipments.
This decision follows similar approvals for tech giants ByteDance, Alibaba, and Tencent, which Reuters reports were collectively allowed to buy over 400,000 H200 chips. DeepSeek's case is separate but operates under the same emerging regulatory framework. Nvidia CEO Jensen Huang, speaking in Taipei, stated the company had not received official confirmation of DeepSeek's approval, indicating the licensing process within China remains ongoing.
The H200 chip, Nvidia's second-most powerful AI processor, has become a focal point in U.S.-China tech relations. While the U.S. recently cleared exports of the chip, Beijing's import controls have been the primary barrier to shipments. The approval carries political risk, as a senior U.S. lawmaker alleged in a letter to Commerce Secretary Howard Lutnick that Nvidia previously helped DeepSeek improve AI models later used by the Chinese military.
Concurrently, Alibaba has shipped over 100,000 of its domestically developed Zhenwu 810E AI chips, a move seen as reducing reliance on U.S. technology. Sources indicate the chip performs similarly to Nvidia's H20 model. The shipment, managed by Alibaba's semiconductor unit T-Head, has already surpassed deliveries from domestic rival Cambricon Technologies. Following successful tests in major Chinese data centers, Goldman Sachs raised its valuation of Alibaba, whose shares rose 3.2%.
This domestic push aligns with broader industry trends. ByteDance is significantly ramping up its AI infrastructure spending, with plans to invest approximately 100 billion yuan ($14 billion) in 2026 for Nvidia AI chips to support its upcoming "Project Titan" large language model. This represents a 17.6% year-over-year increase, the highest growth rate for a private Chinese company since 2023. ByteDance CEO Liang Rubo emphasized the critical need for efficiency in data center operations amid massive investments.
The Chinese Ministry of Industry and Information Technology also released a new policy on January 30, 2026, advocating for "hyper-scale" efficiency in private data centers, mirroring ByteDance's internal goals.
