Nvidia Targets February Delivery of Advanced AI Chips to China
Santa Clara, Tuesday, 23 December 2025.
Nvidia races to ship compliant H200 units by mid-February, facing urgent pressure as local rival Moore Threads claims its new processor already outperforms the US giant’s hardware.
Strategic Pivot Amidst Regulatory Flux
While we previously highlighted the long-term bullish sentiment surrounding Nvidia’s $500 billion revenue opportunity [1], the company now faces an immediate tactical test in the Chinese market. On December 22, 2025, Nvidia informed Chinese clients of its intention to begin shipping the H200 AI chip—its second-most powerful processor—prior to the Lunar New Year in mid-February 2026 [2]. This timeline, however, remains contingent on official regulatory clearance from the Trump administration, which recently signaled a willingness to permit such sales subject to a 25% tariff [2]. The initial logistics plan involves fulfilling orders from existing inventory, with a target of shipping between 5,000 and 10,000 chip modules [2]. This volume equates to approximately 40,000 to 80,000 individual H200 chips [2]. While Nvidia navigates these diplomatic channels to secure its foothold, the competitive landscape within China is shifting rapidly, driven by aggressive domestic innovation.
The Rise of “Little Nvidia”
Just prior to Nvidia’s communication to clients, Chinese chip designer Moore Threads Technology unveiled its latest challenge to Silicon Valley’s dominance. Known locally as China’s “Little Nvidia,” the Beijing-based firm introduced the Huashan chip at a developer conference, with CEO James Zhang claiming the new processor outperforms Nvidia’s Hopper series—including the H100 and H200—in specific metrics like memory bandwidth and computing power [3]. The market has responded enthusiastically to Moore Threads’ potential; since its initial public offering on the Shanghai Stock Exchange on December 5, 2025, the company’s shares have surged by more than 480% [3]. Beyond commercial competitors, academic institutions are also eroding the perceived gap in hardware capabilities. Researchers from Tsinghua University and Shanghai Jiao Tong University have unveiled “LightGen,” a fully optical chip that utilizes photons rather than electrons for processing [4]. While currently limited to specific generative tasks, this photonic architecture has demonstrated speeds 100 times faster than conventional GPUs like those produced by Nvidia, while consuming significantly less energy [4].
Regulatory Loopholes and Gray Markets
As domestic hardware matures, Chinese tech giants are simultaneously exploiting structural loopholes to access Nvidia’s most advanced hardware, which remains officially banned. Tencent has reportedly secured access to Nvidia’s cutting-edge Blackwell B200 chips through a rental agreement with the Japanese cloud provider Datasection [5]. By utilizing this “rental compute” model, Tencent can leverage the processing power of chips deployed in Japan and Australia, bypassing direct export restrictions [5]. Datasection has reportedly secured contracts worth over $1.2 billion connected to this arrangement [5]. Furthermore, the integrity of the supply chain remains a point of contention in Washington. Megaspeed International Pte., a Singapore-based AI firm and major Nvidia partner, has come under scrutiny regarding potential chip diversion [6]. Data indicates the firm has imported tens of thousands more chips than were observed in its data centers, raising concerns among U.S. officials about semiconductor smuggling into China despite Nvidia’s assurances of compliance [6]. As Nvidia rushes to meet its February delivery target, it must balance these complex compliance risks against a rapidly closing window of opportunity in its most critical overseas market.