Citing industry sources familiar with the situation, Reuters is reporting that Nvidia has approached Taiwan Semiconductor Manufacturing Company (TSMC) to expand production capacity for its H200 AI processors.
The report adds that Chinese technology firms have placed orders for more than two million H200 units for delivery in 2026, far outstripping Nvidia’s current inventory of about 700,000 chips.
Those existing units include both standard H200 chips and GH200 superchips that combine Nvidia’s Grace CPU with H200 GPU technology, sources said. Nvidia is seeking additional production slots at TSMC and anticipates that new manufacturing could begin in the second quarter of next year. The exact scale of the expanded order has not yet been revealed publicly.
The H200 is built on Nvidia’s Hopper architecture using TSMC’s advanced 4 nanometer manufacturing process and represents a significant performance upgrade over earlier AI chips available in China. Firms in the region view the H200 as critical for training and running large language models and sophisticated machine learning applications.
Earlier this month the United States government led by President Donald Trump reversed a previous ban on exporting advanced AI chips to China, replacing it with a regime that allows H200 exports subject to a 25 percent duty. This policy shift has opened the door for firms like Alibaba and ByteDance to pursue large scale purchases once Beijing grants import approval.
Chinese authorities are reportedly considering conditions on H200 imports that could require buyers to pair foreign chips with domestically produced hardware in order to support growth of the local semiconductor industry.
Expanding H200 production to satisfy China’s robust demand might affect availability for other customers around the world, especially as global AI hardware supplies remain tight. Nvidia has also been moving forward with newer product lines such as the Blackwell and Rubin chips, which are expected to occupy production capacity in coming months.
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