Nvidia Tells Cloud Partners to Keep Chinese Customers Below 49% of New Business, FT Reports

NVDA is ordering its data center partners to reduce their exposure to Chinese customers, the Financial Times reported on Tuesday, citing people with knowledge of the matter, in a report relayed by Reuters. According to the FT account as carried by AFP and Investing.com, cloud computing clients must now sell at least 51% of their services to non-Chinese companies, which caps Chinese customers at 49%. Reuters said it could not immediately verify the report.

The reported terms are narrower than the headline figure suggests. AFP said the new rules affect only future contracts, not existing agreements, and Investing.com reported that the instruction was delivered verbally through Nvidia's sales force and regional teams rather than in writing, adding that Nvidia previously had no such restriction. The cap applies to how partners such as cloud and neocloud operators allocate the compute they rent out, not to Nvidia's own chip sales. Nvidia neither confirmed nor denied the report to AFP, saying in a statement that "datacenters and clouds built on American chips are the foundation that American model and application makers need to compete worldwide."

The context is Washington's long-running effort to stop Chinese firms from reaching advanced U.S. chips indirectly by renting overseas cloud capacity, a route that outlets covering the report described as increasingly common. Investing.com also noted that several employees at server maker Super Micro were charged earlier this year with smuggling about $2.5 billion of Nvidia AI servers to China. China's foreign ministry spokesperson Mao Ning said she was not aware of the report.

What to watch: whether Nvidia or any cloud partner confirms the policy on the record, how partners define and measure the 49% share, and whether the rule surfaces in partner disclosures or in Nvidia's own commentary at its next earnings report. Because the report rests on unnamed sources and applies only to new contracts, its near-term financial effect on Nvidia or its partners is not yet measurable.