Nvidia delivers initial H200 processors to China, but expects negligible sales from the market
Nvidia confirmed its first shipments of H200 data-centre processors to China under a new US licensing scheme, but these sales accounted for less than 1 per cent of its US$89 billion data-centre revenue in the second quarter. The company's third-quarter revenue forecast still assumes no data-centre computing revenue from China. Despite the muted contribution, Nvidia expects global revenue to grow about 70 per cent in fiscal 2028.
The H200 shipments mark the first approved data-centre processor sales to China since Washington's licensing scheme took effect, following a months-long export lockout. Beijing had initially discouraged purchases of the approved chips to boost domestic alternatives, but began permitting select Chinese AI firms to buy limited quantities last month. Nvidia's second-quarter data-centre revenue reached US$89 billion, with China contributing under 1 per cent of that total.
Nvidia's third-quarter forecast of US$108 billion in revenue still assumes zero data-centre computing sales from China. The company projects roughly 70 per cent revenue growth in fiscal 2028, which CEO Jensen Huang described as supply-constrained rather than demand-limited. Huang noted hyperscalers account for only about half of the opportunity, with enterprises, neo clouds, and sovereign AI projects comprising the remainder.
This development could signal a gradual thaw in US-China tech relations, though the negligible sales volume suggests limited immediate impact. Chinese AI companies may gain incremental access to advanced computing resources, potentially affecting their competitive position in AI development. However, the muted revenue contribution indicates Nvidia's growth remains driven by other markets, which could reinforce the ongoing decoupling of China from cutting-edge semiconductor supply chains.