Nvidia halts production of H20 chips over Chinese security concerns

Tensions between Nvidia and Chinese authorities have reached a new level. Nvidia has ordered its suppliers to halt production of its H20 chip following concerns about security risks such as backdoors and remote control.

Nvidia has ordered key suppliers including Amkor Technology, Samsung Electronics and Foxconn to temporarily halt production of H20 chips due to strained relations with Chinese regulators. According to media reports, Chinese authorities have warned technology companies such as ByteDance, Alibaba and Tencent to temporarily halt purchases of H20 chips due to national security concerns. The main concerns were possible “backdoors” and remote access. China also recently reportedly summoned Nvidia to defend itself over the chip’s design.

Although the US approved the export of H20 chips in April, shipments have not yet been made. Nvidia has confirmed that it is actively managing its supply chain based on market conditions. In May this year, Nvidia announced a $4.5 billion write-down of unsold H20 chip inventories, with quarterly profit likely to have been €2.3 billion higher had there not been export restrictions.

Chief Executive Jensen Huang said in Taiwan on Friday that the H20 chip is strictly a commercial product, not for military use. “There are no backdoors,” he said. “We are working with both governments transparently.” Analysts have warned that a complete ban on H20 chips could threaten Nvidia’s $20 billion in annual sales in China, although sales of lower-priced models could continue into 2026.