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The Takeaway

China’s government has signaled it could allow some domestic companies to buy a new Nvidia chip built for high-end professional computers, according to two people familiar with the matter, as the country’s AI firms strain for enough computing power to run their chatbots and agents.

The Ministry of Industry and Information Technology, which oversees China’s tech sector, recently asked companies including Alibaba Group and ByteDance to report on their plans to buy Nvidia’s RTX Pro 5500 chips, released this month—specifically how many they want to buy and what they’ll use them for, the people said. The ministry has told some Chinese companies the government intends to approve the purchases, they said. Even if that happens, though, it’s unclear when the approvals would come, how many chips officials would allow and what standards they would use to decide.

Nvidia’s China business has faced hurdles from both the U.S. and Chinese governments. Washington has blocked sales of its more advanced AI chips to Chinese buyers to constrain development of the country’s AI industry. Beijing has largely barred Chinese companies from buying Nvidia’s advanced chips, both to help domestic suppliers and because of national security concerns regarding issues such as potential backdoors that could funnel data to the U.S.—a possibility Nvidia has strongly denied.

Approval from China for companies to purchase the RTX Pro 5500 would remove a major barrier. The U.S. government hasn’t publicly addressed whether the chip will avoid U.S. export restrictions, although at least some industry executives are expecting it will.

Nvidia has long complained about U.S. export controls. An Nvidia spokesperson said China’s domestic makers of chips and cards for workstations “have experienced unprecedented growth since 2022,” while U.S. firms “continue to be restricted by a combination of outdated U.S. export controls, which cover gaming products released nearly a half a decade ago, and China’s own limits on U.S. imports.”

Approval for purchases of the new chips would give Nvidia perhaps its best chance in more than a year to regain some momentum in China’s AI market. CEO Jensen Huang has said U.S. export controls have cut his company’s share of China’s advanced AI chip market from about 95% to zero, with domestic companies led by Huawei Technologies filling the void. Nvidia’s forecast for this quarter doesn’t include any data center revenue from China.

For Beijing, the challenge is that Chinese companies are rolling out AI products and services faster than they can find the chips to run them, compelling authorities to rethink their limits on Nvidia. Even Huawei, China’s biggest AI chip developer, can’t keep up, its rotating chairman, Eric Xu, told reporters last week.

Beijing made the inquiries with its companies ahead of Chinese President Xi Jinping’s visit to the White House on Thursday for talks with President Donald Trump. Huang was among the executives who attended a state dinner Thursday evening for that visit, which included discussion of AI but wasn’t expected to yield any breakthroughs on AI chip trade.

The RTX Pro 5500 isn’t one of Nvidia’s top AI chips. It lacks the high-speed links and fast, expensive memory the company puts in most chips it sells for AI data centers. It is intended for the powerful computers engineers and designers use, built on the same core as Nvidia’s best gaming card.

Chinese companies want the RTX Pro 5500 anyway, with ByteDance weighing ordering about 1 million of them, the two people said. The final number could change, depending on how many chips Beijing approves and how many Nvidia can supply.

At least some potential buyers plan to put the chips into servers to help run their AI models for customers. One buyer plans to put eight RTX Pro 5500s in each server, a standard setup that lets the chips work together on larger AI models.

Any significant orders could help Nvidia keep some Chinese developers building on its platform instead of switching everything to competing Huawei products. Nvidia aims to start shipping the chips in late December and is targeting about 500,000 chips a quarter for China, according to two other people with knowledge of those plans. At that pace, ByteDance’s order alone would take two quarters to fill. Nvidia sales staff have told customers to order by Sept. 30 to secure supply, according to two chip buyers, who said the RTX Pro 5500 is popular because it’s good at running AI models once they’re built.

The chip sells for 85,000 yuan to 90,000 yuan (about $13,000) in China, the two chip buyers said, which is roughly what Huawei charges for its Ascend 950PR AI chip, released earlier this year. Demand is spilling over to other Nvidia chips, too. The RTX Pro 6000D—a China-specific model that Beijing barred big Chinese tech firms from buying but smaller companies have been able to purchase—now sells for about 65,000 yuan (close to $10,000), the two buyers said, up from about 50,000 yuan (about $7,500) last year.

The U.S. government has allowed Nvidia to sell older AI chips to China, or chips modified to meet U.S. restrictions on computing capabilities, but Beijing often targets those chips with its own restrictions.

For example, after Trump in December approved China sales of the H200—an AI chip Nvidia first started selling in other markets in 2024—Beijing told companies they could buy the chip only in special circumstances, The Information reported. In July, Chinese officials told some companies, including Alibaba, ByteDance and DeepSeek, that they could buy limited amounts soon if they said how many chips they needed and why.

Few chips arrived. H200 sales to Chinese buyers made up less than 1% of Nvidia’s data center revenue in the quarter ended July 26, according to the company, which said objections from Beijing kept it from selling the full amount its U.S. license allowed.

Beijing has been even tougher on the chips Nvidia made just for China. Last year, China’s internet regulator summoned Nvidia representatives over what it called security risks posed by the H20, a processor designed to fit within U.S. export rules. They then told ByteDance, Alibaba and Tencent Holdings to stop buying Nvidia chips until the regulator finished conducting a security review, The Information reported. They also blocked the RTX Pro 6000D due to security concerns, according to the two people familiar with the government’s discussions with companies.