32 Nvidia B300 chips found inside China Telecom's network

Thirty-two Nvidia Blackwell Ultra B300 processors, a model that U.S. export controls prohibit from sale to Chinese entities, have been identified inside the network of China Telecom, a state-owned telecommunications provider. The finding, reported by The Information, marks a fresh instance of restricted technology appearing within China's domestic infrastructure, a situation that U.S. policy is designed to prevent.

The chips in question are subject to strict regulations. Such high-performance graphics processing units and AI data center hardware can only be sold to buyers on an approved list who agree not to re-export them to sanctioned parties, a category that includes China. The presence of these specific processors at a state-owned Chinese company therefore raises questions about how they bypassed these controls.

The attempt to halt the flow of Nvidia's most capable hardware to China has faced persistent challenges. In 2025, for example, it was reported that Chinese companies smuggled $1 billion worth of Nvidia AI chips into the country over a three-month period. At that time, B200 chips were the most in-demand, though distributors were preparing to sell the subsequent B300-series models as they became available.

While the discovery of these components highlights the ongoing issue of export-controlled chips reaching China, Nvidia has characterized the scale of such diversions as negligible. In a statement to United Herald Now, a company spokesperson said, "Governments, researchers, and media have all found insignificant diversion of controlled US products, less than one half of one percent in recent court cases — a drop in the bucket compared to the ocean of domestic compute China already has." The spokesperson added, "With tens of millions of GPUs in service in approved countries, this report again demonstrates that smuggling is a nonfactor, blocked by governments on both sides of the globe."

The specific method by which the processors entered China Telecom's server racks remains unclear. The identification was made by Lava, an Israeli security firm, which detected the chips using Nvidia's own DCGM Exporter tool. This software, designed for data center operators to monitor server health and performance, can sometimes be accessed from outside the data center's network and, at times, does not require a password for entry. Nvidia has previously confirmed it is developing a tool to allow its chips to be located, though it has not yet been released.

The Blackwell Ultra B300, announced in March of last year, is among the most powerful data center GPUs available. It provides substantial performance improvements over the previous B200 model, delivering 50% more memory and FP4 compute. At its announcement, Nvidia described the chip as "built for the age of reasoning." The B300 was expected to ship by the end of 2025, and it has since become a focal point for enforcement actions; in August 2026, nine individuals were indicted in Taiwan for illegally exporting B300 GPUs to China. This occurred shortly after Supermicro announced it had fired several employees following an investigation into smuggling.

The demand for Nvidia's advanced hardware is so intense that even its older products command a premium. Prices for A100 servers, now five years old, have tripled and can reach up to $82,000. The ongoing pressure to secure Nvidia chips has even led some to retool gaming GPUs for AI workloads where feasible.

The discovery of these processors within China Telecom's network is an ongoing matter. It is not yet clear what action, if any, U.S. authorities may take regarding the finding or how the situation might affect the enforcement of export controls.