Nvidia Tightens Payment Terms for H200 Chip Sales to China

Enhanced Prepayment Requirements

Nvidia has begun demanding full upfront payment from Chinese customers ordering its H200 artificial intelligence chips, according to sources cited by Reuters. This move is understood to be a precautionary measure against the ongoing uncertainty surrounding Beijing's approval for the shipment of these advanced chips.

Stringent Contractual Terms

The US chip manufacturer has implemented extremely strict payment conditions that require customers to pay in full at the time of ordering. Moreover, these contracts do not allow for cancellation, refund, or configuration changes after the order has been placed. In exceptional cases, clients may offer commercial insurance or asset guarantees as an alternative to cash payment, according to one of the sources.

Market Implications

This development highlights the complexities and risks involved in selling advanced semiconductor technology to China, particularly amid geopolitical tensions and export control regulations. Nvidia's cautious approach reflects the potential for regulatory hurdles that could impact the delivery of these high-performance chips. The H200 chip is a significant product in Nvidia's lineup, designed to support advanced AI and computing applications.