Nvidia's proposed H200 AI chip sale to TikTok parent ByteDance faces delays over US security requirements. The Trump administration indicated approval for the export license earlier this month, but negotiations continue as Nvidia reviews commercial terms.
ByteDance allocated approximately $14 billion for Nvidia AI chip purchases in 2026, according to South China Morning Post sources. This is a substantial increase from the company's 2025 spending, which totaled around $12 billion on Nvidia hardware.
US officials require strict customer verification procedures to prevent military access to advanced semiconductors. The conditions include third-party testing of chips before shipment and detailed end-user documentation. These measures accompany a 25 percent revenue share arrangement with the US government.
Nvidia positions itself as an intermediary between Washington and Chinese customers.
"We aren't able to accept or reject license conditions on our own," a company spokesperson stated. "For American industry to make any sales, the conditions need to be commercially practical."
ByteDance emerged as China's largest Nvidia chip purchaser in 2025, acquiring more units than any other domestic firm. The company sought computing power for its billion-plus user platforms amid concerns about potential US supply restrictions.
Chinese regulators previously blocked ByteDance from deploying Nvidia chips in new data centers. In August 2025, authorities instructed local firms to halt new Nvidia AI chip orders and transition to domestic processors. Beijing continues pushing technology self-sufficiency while navigating export controls.
The $500 billion-valued ByteDance maintains an internal chip development division with about 1,000 employees. This team created a processor comparable to Nvidia's China-market H200 variant at reduced cost, reflecting broader industry shifts toward domestic alternatives.
China granted preliminary import approval to ByteDance, Tencent, Alibaba, and AI startup DeepSeek for advanced chips. However, Beijing's regulatory framework remains incomplete, adding complexity to cross-border technology transfers.
President Donald Trump authorized chip shipments to China in December 2025 under the revenue-sharing model. The arrangement extends to similar semiconductors from AMD and Intel, though critics warn about potential military applications.
Any H200 shipments to ByteDance are contingent on finalizing security verification protocols, as the company has allocated approximately $14 billion for Nvidia AI chip purchases in 2026.
