Nvidia Cuts Its Approved Asian AI Chip Buyer List by More Than Half

Nvidia has cut by more than half the number of Asian companies cleared to buy its artificial intelligence chips, swapping looser vetting for a new compliance whitelist across Singapore, Malaysia and Japan. The Financial Times reported the change Tuesday, citing three people familiar with the screening overhaul.

Companies dropped from the list can reapply once they fix whatever got them cut. The timing lands weeks after a Senate committee accused Nvidia’s board of failing to police where its chips end up, and just as Nvidia’s own finance chief admits the company has booked zero revenue from the one advanced chip Washington actually licensed for sale to China.

Nvidia Halves Its Approved List of Asian Chip Buyers

Nvidia built the new roster after months of expanding its screening in Singapore, Malaysia and Japan, the three markets the Financial Times named in its report. Firms that make the list get treated as approved counterparties. Those that don’t lose access until they clean up whatever compliance issue flagged them, though the door stays open to reapply.

Nvidia, which holds the world’s largest market valuation despite trailing chip rivals’ gains, aimed its new due diligence at exactly the two countries that keep surfacing in federal smuggling indictments, plus Japan, which so far hasn’t. The overhaul took several months to build, according to the people who described it to the Financial Times.

Congress Was Already Asking Questions

The Senate Banking Committee sent Nvidia’s board a letter questioning its export compliance oversight on June 1. The letter leaned on a short seller, Culper Research, which alleged that more than “20% of Nvidia’s FY 2026 compute revenues remained driven by China.”

Independent estimates back the scale of the problem, even without matching the exact figure. Epoch AI, a research group that tracks AI compute trends, put 660,000 H100-equivalent chips smuggled into China by the end of 2025 as its median estimate, equal to roughly a third of the country’s total AI computing capacity.

• 20% of Nvidia’s fiscal 2026 compute revenue, Culper Research alleged, still traced back to China through diversion and Southeast Asian intermediaries.
• $510 million in Nvidia-equipped servers were diverted to China in just a few weeks in spring 2025, according to the Senate committee’s letter.
• 660,000 H100-equivalent chips is Epoch AI’s median estimate for illegal diversion to China through the end of 2025.
• $40,000 to $60,000 is the gray market price of a single H100 chip inside China, roughly double its authorized cost, industry estimates show.

None of those figures come from Nvidia itself. Chief executive Jensen Huang had told Bloomberg in 2025 that Nvidia’s hardware was too bulky to smuggle easily and that customers police their own compliance. A year of federal indictments has tested that confidence.

Who Gets Cut from Nvidia’s Whitelist?

Nvidia’s new vetting doesn’t single out one country. It rechecks every reseller and data center operator across Singapore, Malaysia and Japan, the three markets the Financial Times named, after months of smuggling cases showed how legitimate-looking buyers funneled chips toward China.

Singapore carries the heaviest scrutiny. Reports have examined Megaspeed’s Blackwell GPUs reaching China, a concern that carries weight since Megaspeed is described as Nvidia’s largest Southeast Asian customer. Singapore authorities separately looked at shipments tied to Dell and Super Micro Computer that moved through Malaysia.

• Singapore hosts Nvidia’s largest Southeast Asian customer and the most active law enforcement scrutiny of reseller conduct.
• Malaysia keeps surfacing in federal filings as a transshipment point for servers rerouted toward Chinese buyers.
• Japan joined the enhanced screening even though it hasn’t featured in a major smuggling indictment so far.
• Reapplication stays open, since companies cut from the list can rejoin once they tighten internal compliance controls.

The pattern matches what enforcement officials describe elsewhere. Chris McGuire, a technology expert and former State Department official, said the loophole that let Chinese-owned subsidiaries buy top-tier chips through Southeast Asian addresses was, in his words, “a HUGE problem.”

The Smuggling Cases That Forced Nvidia’s Hand

Four cases from the past year explain the pressure on Nvidia. Each involved a different country, a different method, and mostly a different set of Nvidia products.

The Taiwan case, still unfolding, shows how far the concealment went. Keelung prosecutors allege a three-year scheme generating $300 million in illegal profit, built on shell companies, staged inspections and fabricated export paperwork. Investigators call the technique origin laundering.

The Manhattan case hit Nvidia’s supply chain closest to home. Prosecutors say Yih-Shyan “Wally” Liaw, Super Micro Computer’s co-founder, directed a scheme routing H100 and H200-equipped servers through a Southeast Asian shell company before they reached Chinese buyers. The stock lost more than $6 billion in value the day Liaw was arrested.

Nvidia’s China Business Has Already Shrunk to Zero

The market the whitelist is meant to protect is largely gone already. Nvidia’s chief financial officer, Colette Kress, told investors that although the US government approved small H200 shipments to China-based customers, “we have yet to generate any revenue.” She added that Nvidia can’t be sure Chinese customs will ever clear the chips for import.

Beijing has its own reasons for the freeze. Customs officials reportedly instructed agents that H200 chips were “not permitted” to enter the country even with fresh US licenses in hand, according to the Center for Strategic and International Studies.

Domestic alternatives are filling the gap Beijing created. Huawei’s Ascend 950PR is scaling toward 750,000 units this year, Cambricon plans roughly 500,000 AI accelerators, and Chinese-made chips already cover about 41% of the domestic market, according to IDC data cited by Brookings, with Huawei supplying roughly half of that total.

It hasn’t shown up as a rounding error yet in Nvidia’s topline. China and Hong Kong still made up about 9% of Nvidia’s fiscal 2026 revenue, though that share keeps shrinking under the export controls. Nvidia has also crossed a $5.1 trillion valuation even as its China sales evaporated, a sign investors priced the country out long ago.

Beijing’s posture hasn’t stayed fixed the whole way through. Regulators had earlier signaled they would let Alibaba, ByteDance and DeepSeek buy H200 chips, before customs pushback complicated even those approvals.

The Smuggling Networks Sit Upstream of Nvidia’s List

None of the four cases above ran through a direct customer relationship this kind of screening would have caught. They ran through server assemblers, Taiwanese distributors and shell companies, several steps removed from Nvidia’s own sales desk.

At Nvidia’s annual shareholder meeting, Huang called the $2.5 billion smuggling scheme a “dead end,” arguing that data centers built on smuggled hardware can’t get the technical support they need to keep running.

We insist our partners are compliant. We hope that they will enhance and improve their regulation compliance and prevent that from happening in the future.

Huang made that pledge after arriving in Taipei following Taiwan’s own crackdown on AI hardware smuggling, days after prosecutors detained the six Keelung suspects.

The May 31 guidance closing the overseas-subsidiary loophole isn’t retroactive. Chips already installed in Southeast Asian data centers keep running under the old rules. The rule only stops future orders, whichever list a buyer happens to sit on.

Frequently Asked Questions

What Is Nvidia’s New Asia Buyer Whitelist?

Nvidia has used whitelists before. In 2025 the company built a separate roster for Chinese firms, including ByteDance and Tencent, applying to buy H20 chips directly. The new list works differently: it screens resellers and data center operators in Singapore, Malaysia and Japan, the companies buying from Nvidia rather than the Chinese firms buying from them.

Which Company Sits at the Center of Taiwan’s Smuggling Case?

Taiwan’s Qyun Technology, Super Micro’s local distributor, sits at the center of the Keelung case. Prosecutors detained senior executives there and allege servers built with Nvidia’s H100 chips were falsely declared for shipment before reaching China, Hong Kong and Macau.

Are Nvidia’s AI Chips Legal to Sell to China?

Some are, depending on the model. Nvidia’s older H20 chip resumed shipping to China in 2025, and the H200 received US export licenses in December 2025 carrying a 25% tax, part of a deal in which Nvidia and AMD agreed to pay Washington 15% of China chip sales in exchange for licenses. Nvidia’s newest Blackwell-class chips remain fully blocked from the Chinese market.

How Much Has the China Chip Freeze Cost Nvidia?

Nvidia has taken a $5.5 billion writedown tied to unsold China inventory and left an estimated $14 billion to $18 billion in annual sales out of its outlook, since no China data-center revenue is currently booked. The company has generated zero revenue from licensed H200 shipments because Chinese customs has not cleared them for import.

Has the Smuggling Scandal Hurt Nvidia’s Own Business?

Not financially, at least so far. Nvidia’s most recent quarter, ended April 26, produced $81.6 billion in revenue, up 85% year over year, and $58.3 billion in net income, up 211%. The company also authorized an $80 billion stock buyback and raised its dividend from a penny to a quarter per share.