Nvidia is bolstering support for Chinese open AI models as it warns of White House crackdown

Nvidia is bolstering support for Chinese artificial intelligence models in a play to beat domestic chipmakers to optimizing hardware for the systems. The move comes amid growing unease among U.S. lawmakers about the adoption of Chinese AI models by American companies.

The chip giant on Wednesday highlighted a "local AI initiative with optimizations for top open models," including DeepSeek's V4 Flash and Alibaba's Qwen 3.8, alongside systems developed by Google and Nvidia itself.

But an SEC filing linked to the company's second-quarter earnings also warned of business risks from potential White House restrictions on AI developed in China.

Chinese AI models have made leaps in capability in 2026 and their increasing adoption by developers across the globe — including in the U.S. — has intensified a wave of anxiety from lawmakers in Washington.

Access to open AI models, the most capable of which are Chinese, has become a key flashpoint in the intensifying race for technological supremacy between the U.S. and China. Open AI models can be modified and self-hosted, in contrast to leading closed systems produced by OpenAI and Anthropic.

Both Beijing and Washington have looked to leverage political heft to gain an advantage, with a report emerging on Thursday that U.S. President Donald Trump's administration is considering new tariffs on U.S. semiconductors.

A White House official told CNBC that "unless officially announced by the Administration, any reporting about tariffs should be regarded as baseless speculation."

The U.S. is also mulling restrictions that would limit Nvidia's ability to support "third-party applications and models built on open-source foundation models originating in China," the company said, reiterating messaging in previous earnings.

It warned that any "regulatory control or other restriction that limits our ability to provide products and services" supporting apps built on models "such as DeepSeek, Qwen or Kimi" could have a material impact on business.

Nvidia shares rose on Thursday after the company reported better-than-expected second-quarter results and issued revenue guidance that topped estimates. The tech giant, which holds a near monopoly over the most advanced AI chips, has seen its stock rise more than 10% so far in 2026.

Nvidia stock Nvidia's not alone in campaigning against U.S. government intervention in open models, which can be downloaded, modified and self-hosted by companies.

Microsoft, Meta, Palantir and more than 20 other companies joined the chip giant in issuing a statement in July, urging policymakers to avoid "premature restrictions" on open-weight models.

"Providing support for models worldwide allows developers to build on the American tech stack," an Nvidia employee, who asked not to be named as they weren't authorized to share the information, told CNBC.

"Developers using popular American and Chinese models will choose the stack that the model is optimized for, making the need to optimize for the American stack critical," they added.

Chinese chipmakers including Huawei, which makes the Ascend series of processors, and Alibaba have announced their own optimizations for open models, including the DeepSeek and Qwen series, in recent months.

"Developers will play a crucial role in building the winning AI ecosystem," the Nvidia employee said. "China has one of the largest populations of developers in the world, creating open-source foundation models. Every model should run best on the U.S. technology stack, encouraging nations worldwide to choose America."

There are worries that Chinese AI models, which are increasingly capable and typically cheaper than American alternatives, could become the default for developing countries.

"If Chinese AI technology becomes the default for developing countries, those countries may be more likely to align themselves politically with Beijing and Chinese AI companies get a beachhead in their markets," Daniel Remler, senior fellow, technology and national security program at think tank the Center for a New American Security (CNAS), told CNBC.

Nvidia's optimization of its hardware for Chinese AI models reflects their "growing influence" within the global AI ecosystem, Charlie Dai, VP and principal analyst at Forrester, told CNBC.

"By optimizing platforms such as DeepSeek and Qwen, Nvidia is reinforcing its position as the preferred infrastructure layer for AI developers and enterprises regardless of where leading models originate," he added.

Nvidia announced in August that it was optimizing hardware stack, including "day-zero support" on its RTX GPU systems for Qwen3.8-27B. The company also said that month that updates to its software made it "easy to cluster multiple DGX Spark systems together," which was important for running Chinese models like Z.ai's GLM 5.2 and DeepSeek V4 Flash.

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