Nvidia plans H200 production ramp at TSMC while China debates whether to let the chips in

Nvidia's China business is ramping up again. According to Reuters, the chip company is in talks with contract manufacturer TSMC to expand production of its H200 AI chips to meet surging demand from China. Chinese tech companies have ordered more than two million H200 chips for 2026, but Nvidia currently only has 700,000 units available.

Production at TSMC is set to begin in the second quarter of 2026, with Nvidia planning to sell the chips for around $27,000 each. ByteDance alone, TikTok's parent company, plans to spend around 100 billion yuan (about $14 billion) on Nvidia chips in 2026, according to the South China Morning Post.

The Trump administration recently cleared H200 chip exports to China with a 25 percent fee attached. However, China hasn't approved the imports yet. Officials there are still debating whether access to advanced foreign chips might slow down the country's domestic chip industry. One proposal under consideration would require every H200 order to include a certain percentage of chips made in China.

China is also working on a rule that would require domestic chip manufacturers to use at least 50 percent locally made equipment.