Nvidia has sharply reduced the number of Asian customers allowed to buy its AI hardware, according to the Financial Times, in an attempt to stop its GPUs and servers from being routed into China through front companies.
The Financial Times reported that Nvidia built a new list of verified buyers and cut the authorized roster by more than half. The remaining customers had to clear stricter compliance checks meant to prove they were real operators, rather than shell businesses created to move restricted hardware across borders.
The reported checks were more than paperwork theater. Nvidia staff visited customer data centers, reviewed contracts and interviewed end users, the Financial Times said. That is the boring part of export control enforcement, and also the part that matters: a server sold to a plausible reseller can still end up in a Chinese data center if nobody checks who will actually run it.
Washington pushed Nvidia to tighten the gate
The Financial Times said Nvidia acted after pressure from Washington to improve legal compliance around sales of advanced AI chips. Nvidia was not immediately available for comment, according to Tom's Hardware.
The move follows a widening set of investigations into alleged Nvidia hardware diversion. Yih-Shyan “Wally” Liaw, a co-founder of Supermicro, and two other suspects were arrested over allegations that they smuggled $2.5 billion worth of Nvidia hardware into China. In Singapore, authorities seized a $42 million mansion tied to alleged AI GPU smugglers. In Taiwan, officials raided Supermicro offices and two supply-chain partners as part of a chip-smuggling probe.
The United States has restricted exports of Nvidia’s newest AI GPUs to China since 2022. Even so, investigations cited by Tom's Hardware found that Chinese companies were still able to obtain restricted chips until recent enforcement efforts made supply harder to find.
The mechanism is not exotic. Restricted chips can move through intermediaries, resellers, declared end users that do not match the real end user, or servers whose final destination differs from the paperwork. Nvidia’s reported list tries to narrow that gap by making customers prove they exist, operate real infrastructure and have contracts that match the sale.
China’s AI chip supply is tightening
Tom's Hardware reported that enforcement by Washington and allied governments has reduced chip availability in China, making it harder for AI companies there to buy the processors they want.
President Donald Trump changed course in December 2025 and allowed Nvidia to export H200 GPUs to selected customers in the region, according to Tom's Hardware. Beijing, however, refused to let Chinese companies buy those processors and is instead relying on domestic semiconductor suppliers to cover the gap.
That substitution appears strained. A technology executive told the Financial Times that domestic suppliers are sold out and that buyers are considering less powerful chips if they can still be used.
Nvidia has also warned partners that compliance is their problem, not a decorative clause in a purchase order. After Taiwan began operations against alleged AI chip smuggling into China, Nvidia chief executive Jensen Huang told media in May: “We insist our partners are compliant.” He added: “We hope that they will enhance and improve their regulation compliance and prevent that from happening in the future.”
The reported customer purge shows Nvidia trying to protect access to its most lucrative hardware markets while satisfying U.S. export rules. The company sells the chips; governments decide where they are allowed to land. The messy middle is now getting inspected.
This story draws on original reporting from Tom's Hardware.
