Chinese AI companies seek overseas Nvidia capacity on Huang scandal fears

A workaround has existed within U.S. export controls: Washington restricts exports to China of Nvidia's most advanced AI chips, but Chinese companies can still access such processors remotely by renting computing power at data centers overseas. That gap is now the focus of concern.

The trigger is a scandal involving Nvidia CEO Jensen Huang, which the people familiar with the matter say could spur Washington to tighten restrictions on remote use of advanced processors. In response, a major Chinese cloud provider has discussed internally whether to lock in overseas Nvidia chip capacity, while some companies have contacted data-center operators about reserving it, according to the three people. The people declined to be identified, or to identify the cloud provider, because of the sensitivity of the matter.