Nvidia's AI Chip Sale to ByteDance Depends on Trump-Era Conditions

• The U.S. approved the license approximately two weeks ago, but Nvidia has not accepted the proposed Know-Your-Customer (KYC) requirements to ensure China's military cannot access the chips
• Nvidia is negotiating with the U.S. over license terms for H200 chip shipments to Chinese companies, stating it cannot unilaterally accept or reject conditions as an intermediary between government and customers
• President Trump personally greenlit sales of H200 and similar AMD chips to China once national security concerns are addressed, signaling potential broader chip exports to Chinese AI companies

Summary: Nvidia's AI Chip Sale to ByteDance Hinges on Trump Administration Conditions

The Trump administration has agreed to approve the sale of Nvidia's H200 AI chips to Chinese tech giant ByteDance, but the deal remains stalled over implementation conditions. The U.S. government granted license approval approximately two weeks ago, but Nvidia has not accepted the proposed Know-Your-Customer (KYC) requirements and other restrictions designed to prevent China's military from accessing the advanced chips.

Key Developments:

Nvidia is currently negotiating with the U.S. government over license terms for shipping H200 AI chips to multiple Chinese companies. The chipmaker contends it serves as an intermediary between the government and customers and cannot unilaterally accept or reject license conditions. A company spokesperson emphasized that while KYC protocols are important, the conditions must be "commercially practical" or the market will shift toward foreign competitors.

Market Context:

ByteDance, owner of TikTok and one of China's largest AI companies, represents a significant potential customer for Nvidia's high-performance AI chips. The U.S. government is expected to allow sales of H200 chips from Nvidia and similar products from AMD to China, following President Trump's authorization, once national security concerns are adequately addressed.

Implications:

The situation highlights ongoing tensions between U.S. technology export controls and commercial interests. Nvidia's concerns about "commercially practical" conditions suggest potential implementation challenges that could impact sales to the Chinese market. The outcome could set precedents for future AI chip exports to China and affect Nvidia's competitive position against non-U.S. chipmakers.