TLDR
- Nvidia has cut more than half of its authorised Asian buyers of AI chips, creating a new “white list” of approved customers.
- The crackdown focuses on Singapore, Malaysia, and Japan, targeting neo-cloud providers that failed compliance checks.
- The move follows pressure from the Trump administration to stop advanced chips reaching China via third countries.
- Nvidia staff now visit data centres, verify contracts, and interview end users as part of the new checks.
- NVDA stock fell 3.52% on the news.
Nvidia dropped 3.52% after the Financial Times reported the chipmaker has more than halved the number of Asian customers allowed to buy its AI chips.
The company has introduced a “white list” system. Only businesses that pass tougher compliance checks make the cut. More than half of its previous customers in the region did not.
The scrutiny is focused on Singapore, Malaysia, and Japan. Neo-cloud providers — companies that rent out cloud computing power — were among the hardest hit, with many failing the initial review.
Companies that were removed from the list are not permanently banned. They can reapply after making the required changes, according to the FT report.
The tighter rules come as the Trump administration works to close loopholes that have allowed Chinese entities to get hold of advanced American chips through third countries.
The U.S. Commerce Department issued guidance in May specifically aimed at stopping Nvidia’s Blackwell processors from reaching Chinese-linked companies in countries like Malaysia, despite existing export restrictions.
Nvidia has responded by stepping up its compliance process across the region. Staff now physically visit customer data centres, verify contracts, and conduct interviews with end users.
The U.S. Department of Commerce is also directly involved, providing oversight and political backing for the effort, the FT said.
Background on the Crackdown
Washington has had export restrictions on AI chip sales to China in place since at least 2021. The restrictions have tightened over time as demand for advanced chips has surged.
Last year, Nvidia was permitted to sell a downgraded H200 chip to Chinese customers. Beijing responded by blocking domestic sales of that chip, partly to protect and encourage local chip development.
In March, U.S. prosecutors charged a Supermicro co-founder and two employees with allegedly helping smuggle $2.5 billion worth of Nvidia chips to China. Prosecutors alleged the group used a southeast Asian company as a proxy to ship chips from Taiwan to China.
What This Means for Nvidia’s Asia Business
The reduction in authorised buyers represents a real hit to Nvidia’s customer base in a fast-growing region.
Singapore, Malaysia, and Japan have all seen strong demand for AI infrastructure in recent years, making the new restrictions particularly pointed.
Nvidia did not respond to requests for comment from Reuters outside regular business hours, and the company has not publicly addressed the FT report.
The U.S. Department of Commerce also did not respond to comment requests in time for publication.
Reuters was unable to independently verify the details of the FT report.
The FT cited three people familiar with the matter as the basis for its reporting on the white list and the compliance process changes.
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