NVIDIA CEO Denies AI Chip Diversion to China Amid Ongoing Controversy

Nvidia CEO Jensen Huang says 'There's no evidence of any AI chip diversion'

Nvidia CEO Jensen Huang says that there is no evidence of AI chip diversion to countries where the sale of said chips is prohibited, in response to questions at Computex 2025. Huang told Bloomberg that there is no evidence of diversions when it comes to its Grace Blackwell chips. Furthermore, he added that Nvidia's customers are well aware of the restrictions and that they are careful about it when selling to third parties. "Governments understand that diversion is not allowed, and there's no evidence of any AI chip diversion -- recognize our data center GPUs are massive; these are massive systems," Huang said during the surprise questioning. "The Grace Blackwell system is nearly two tons, and so you're not going to be shipping -- you're not going to be putting that in your pocket or your backpack anytime soon. And so, these systems are fairly easy to keep track of... but the important thing is that the countries and the companies that we sell to recognize that diversion is not allowed, and everybody would like to continue to buy Nvidia technology, and so they very well monitor themselves very carefully and they're quite careful about that." However, this doesn't seem to be the reality. After all, we've already heard of several instances of Nvidia AI GPUs getting past Washington's sanctions and getting into the hands of Chinese businesses. We've even seen one businessman showing off his smuggled H200 GPUs on X. Even as late as March 2025, there have been reports of Chinese entities using corporations registered in neighboring countries like Malaysia, Vietnam, and Taiwan to order these advanced chips and then reroute them to China. Singapore has already started cracking down on this practice, and the U.S. has also asked Malaysian authorities to keep an eye on this black market and shut it down. However, Malaysian imports of advanced GPUs still surged by over 3,400% in early this year, raising alarm bells. Huang also said that these servers are massive, weighing several tons, so tracking them shouldn't be difficult. But the company has also said that these AI chips are impossible to find after they're sold. That's why the U.S. Congress is considering legislation that would require companies to enable geo-tracking on high-end gaming and AI GPUs. Furthermore, weight and size are no issues when it comes to smuggling. After all, if stolen cars and SUVs can be smuggled across borders, then GPU servers are fair game as well, especially with the amount of money involved.

NVIDIA's CEO Claims There's No Evidence of AI Chips Going Into China, Says Grace Blackwell Servers Cannot "Fit In Pockets" To Go Undetected

NVIDIA's CEO has apparently taken a dig at industry rumors that say the firm's chips are being used in China, and claims that there's no evidence to back such rumors. There's a lot of uncertainty surrounding NVIDIA and its business in China, given that the US believes that Team Green's high-end AI chips are ending up in hostile nations, threatening national security. The US has been catering to this issue by implementing strict regulations, which have hindered NVIDIA's business in China tremendously, but CEO Jensen Huang believes that there's no sign of chip diversion to China, saying that the hardware is too difficult to smuggle across such nations. There's no evidence of any AI chip diversion. These are massive systems. The Grace Blackwell system is nearly two tons, and so you're not going to be putting that in your pocket or your backpack anytime soon. The important thing is that the countries and the companies that we sell to recognize that diversion is not allowed and everybody would like to continue to buy Nvidia technology. - NVIDIA's CEO via Bloomberg Well, chip diversion doesn't only include Grace Blackwell AI clusters being moved to China, it also takes into account AI hardware like H100 AI accelerators, which are said to be readily available in the region, despite US restrictions. So, Jensen's claim of NVIDIA's chips not being in China isn't entirely true, but we still are not to the point where rack-scale architecture is being smuggled to the region, such as the GB300 systems. Team Green doesn't look happy with the constant US regulations, which are said to have significantly impacted the company's influence in China. One of the primary sources through which China has been accessing NVIDIA's AI chips is by leveraging trade loopholes and importing from nations such as Singapore, which isn't "legally" wrong. NVIDIA's CEO might not have considered this when discussing the chip diversion. However, it won't be wrong to say NVIDIA won't have an easy time doing business with China anymore, since with new US regulations, the company's options for the domestic market have become limited, so in-house alternatives from Huawei have become a better choice. However, while NVIDIA has seen a compromise from China, the firm is eventually moving away from Big Tech and is now supplying hardware to governments, notably the Middle East. In the past few weeks, NVIDIA has grabbed orders for "millions of accelerators" and plans to build large-scale AI datacenters in countries like the UAE and Saudi Arabia.