Nvidia's advanced artificial intelligence chips worth at least $1 billion were smuggled to China in the three months after Washington tightened chip export controls, the Financial Times reported on Thursday.
The AI chip designer's high-end B200 processors, banned for sale in China, is widely available on a thriving Chinese black market for U.S. chips, the report said, citing sales contracts, company filings and multiple people with direct knowledge of the deals.
Nvidia told Reuters that building data centers with smuggled products is inefficient both technically and financially, as the company only offers service and support for authorized products.
The U.S. Department of Commerce, White House and Thai government did not immediately respond to requests for comment. Reuters could not independently verify the FT report.
In May, multiple Chinese distributors started selling B200s to suppliers of data centers that serve Chinese AI groups, according to the report.
The U.S. and China are battling for global dominance in AI and other cutting-edge technologies, triggering a tightrope walk for companies such as Nvidia between the world's two largest economies.
Nvidia last week said it would be allowed to resume sales to China after the Trump administration reversed an export restriction on the sales of chips such as H20. The curbs were imposed in April.
In the three months before that, Chinese distributors from Guangdong, Zhejiang and Anhui provinces sold Nvidia's B200s, as well as other restricted processors such as the H100 and H200, according to the report.
Southeast Asian countries have become markets where Chinese groups obtained restricted chips, the report said, citing industry experts.
The U.S. Commerce Department is discussing adding more export controls on advanced AI products to countries such as Thailand as soon as September, the report said.
