The Trump administration might have decided to spare AI chip designer NVIDIA's H20 GPUs from being targeted by new rules to stop their sales to China. NVIDIA's GPUs were at the center of 2025's first major stock market selloff in January when the firm lost close to $600 billion in market value after Chinese AI startup DeepSeek's AI models demonstrated comparable performance to Western products despite using fewer resources. Since then, NVIDIA's GPUs have been at the center of attention as sources have speculated that the firm's China-specific H20 GPUs might be on the Trump administration's radar for additional sanctions.
NVIDIA H20 GPUs Spared From Additional Curbs By Trump Administration
According to sources quoted by NPR, NVIDIA CEO Jensen Huang's meeting with President Trump last week was fruitful. The White House has now decided not to impose sanctions prohibiting NVIDIA from selling its H20 GPUs to China. The H20 chips are a custom variant designed for China, and they are the most technologically advanced NVIDIA product that can be sold to the country.
NPR outlines that the Trump Administration's H20 sanctions were in the advanced stages and could have been announced as soon as this week. NVIDIA's shares bled last month after media reports highlighted a year-old Chinese document requiring data centers to be environmentally friendly.
The selloff indicated the reliance on Chinese revenue for the firm's income statement. NVIDIA's shares are up by 5.9% after having lost 7.6% since the President announced his tariffs last week.
As to what made the Trump administration back down, one source claims that NVIDIA promised new investments in US AI data centers. Since taking charge, President Trump has been eager to attract as much domestic investment as possible as part of his efforts to build new plants and factories in America. NVIDIA's chip supplier, Taiwan's Taiwan Semiconductor Manufacturing Company (TSMC), announced a $100 billion investment package earlier this year as part of these efforts.
Spokespersons for the White House and the Commerce Department did not respond to NPR, while NVIDIA declined to comment. NVIDIA's H20 GPUs have reportedly been in shortage in China as domestic players stocked up this year in anticipation of the new rules. A client notice from a server company that surfaced last month claimed that the chips might be in short supply.
The H20 GPUs were also used by DeepSeek to train its AI models, with the firm relying on a deeper-level programming language to control their performance over NVIDIA's standard CUDA programming language.
The H20 GPUs are the most advanced AI GPUs that Chinese firms can lay their hands on, with domestic firms such as Huawei and domestic chip manufacturers such as SMIC being significantly behind their Western and Taiwanese counterparts when it comes to chip design and manufacturing.
