Nvidia Rebuts Chinese State-Media Claims Over H20 Security; Analysts Warn of Risks to China Market and U.S.–China Talks

NVIDIA denied new accusations of Chinese media on Sunday that its H20 artificial intelligence tokens have national security risks for China, calling false affirmations and reiterating that its products do not contain “waste” or Shutdown functions from a distance.

The criticism came from Yuyuan Tantian, a WeChat account affiliated with the CCTV state diffuser, which published an article affirming that the H20 chips were “neither technologically advanced nor environmentally friendly” and alleging that they could perform functions such as “remote stop” via a material stressrometer.

The article ended with a consumer warning: “When a type of chip is neither environmentally friendly, advanced, nor safe, as consumers, we certainly have the possibility of not buying it.”

A spokesperson for Nvidia told CNBC in response that cybersecurity is a central priority and that “Nvidia has not” rear “in our chips which would give anyone a distant way of accessing or controlling them.” The company previously rejected similar accusations, including suggestions that the chips contain a so-called “killing switch” and reiterated these denials in the comments of the weekend.

The H20 chip was developed as a product in accordance with China after the American export restrictions at the end of 2023 prohibited the sale of Nvidia’s most powerful accelerators. The chip is a less advanced alternative to the flagship models of Nvidia, such as the H100 and the B100; It was designed so that the company can legally serve the Chinese market while complying with American rules. In April, the Trump administration briefly prohibited H20 exports to China, but the ban was reversed in July after an intensive lobbying and a high -level discussion, including interventions by the CEO of Nvidia, Jensen Huang. After the overthrow, the H20 shipping licenses resumed, although the episode left persistent political and regulatory sensitivities on both sides.

Nvidia was faced with real financial pain in the disruption: the company obtained a boost of $ 4.5 billion in the inventory of H20 not sold in May and said that its front -line advice for the July quarter would have been around $ 8 billion higher without export restrictions. Despite the backdrop, NVIDIA’s shares were maintained: they closed $ 182.70 on Friday, up approximately 1% for the day and around 36% year to it.

Chinese authorities have also taken on official interest. The Beijing Cyberespace regulator summoned NVIDIA for interrogated in the midst of concerns about stolen doors and has publicly pressed the company to provide convincing security insurance. The media such as People’s Daily have echoed the demand that Nvidia demonstrates that tokens are sure if he hopes to reconstruct confidence with Chinese buyers.

The accusations present a risk to the NVIDIA Chinese market strategy and American-China-China technological diplomacy

Analysts believe that the climbing of the AI H20 chips of Nvidia has the potential to resonate far beyond a single range of products, threatening the competitive position of the company on one of its most important markets while adding a new complexity to the technology of American-chine technology in progress.

The framing by the Chinese state media of the H20 as “neither of the environment, no advanced, nor without security” is not only a stroke of public relations, but could not influence supply decisions in the public and private sectors in China either. Given the country’s growing emphasis on the development of indigenous chips and technological autonomy, allegations – including the claim of a potential material rear door “remotely stopping” – feed a broader story than foreign manufacturing chips pose security vulnerabilities. Even if Nvidia firmly denied these accusations, perception alone could have an impact on buyers’ confidence, in particular in strategic industries such as defense, telecommunications and research on AI, where confidence in the supply chain is essential.

For Nvidia, who hoped to resume H20 shipments in China after the Trump administration has raised a previous ban, it is a delicate balancing. CEO Jensen Huang has supported Trump’s wider technological policies while putting pressure on export licenses that would allow Nvidia to sell more advanced fleas on the Chinese market. Its argument that flea-made in the United States becoming the world standard of AI strengthens American influence is now challenged by Beijing messaging, which depicts the H20 as a compromised and second level product compared to the H100 and B100 flagship fleas.

The time of these accusations is particularly significant, as Chinese officials put pressure for the United States to facilitate export restrictions on large -band memory fleas before a possible Trump – XI summit. Nvidia’s position in China and the political optics of American technological domination could be part of the negotiation equation. If Chinese buyers evolve purchases, either in response to political pressure, or in perceived security risks, NVIDIA’s risks lose market share against national competitors such as the Huawei Ascend series or other manufacturers of chips supported by the state.

Economically, Nvidia has a lot to lose. China is one of the largest NVIDIA markets, and the company has already carried out an H20 inventory of $ 4.5 billion in the H20 inventory, warning that revenues from the July quarter would have been $ 8 billion without export restrictions. Any other contraction in Chinese sales could weigh heavily on its growth trajectory, in particular if the slowdown coincides with intensified national competition in the United States and Europe.