Nvidia Responds to Reports of Blackwell Ultra B300 Chips in China Telecom Network

Nvidia has stated that the smuggling of its advanced processors is a negligible issue, following the discovery of 32 restricted Blackwell Ultra B300 units inside the network of China Telecom. The Israeli security firm Lava identified the accelerators operating within the systems of the state-owned telecommunications provider. The B300 chips are subject to strict U.S. export controls, which prohibit their sale to buyers who do not agree to refrain from supplying sanctioned parties, including those in China.

Despite the presence of these restricted units in a Chinese data center, Nvidia declined to deny the findings but argued that the scale of unauthorized diversion is minimal. A company spokesperson stated that governments, researchers, and media have consistently found the diversion of controlled U.S. products to be insignificant. The spokesperson noted that court cases have identified diversion rates of less than one half of one percent, characterizing the issue as a drop in the bucket when compared to the volume of domestic compute already available within China. The company asserted that with tens of millions of its units in service in approved countries, smuggling remains a nonfactor because it is blocked by governments on both sides of the globe.

The method by which these specific B300 units entered China Telecom's server racks remains unknown, as does their precise location within the company's infrastructure. Lava identified the presence of the chips by utilizing Nvidia's own DCGM Exporter tool. This software is intended for data center operators to monitor the health and performance of server hardware. However, the tool can often be accessed from outside the data center's network, and it does not always require password authentication. Nvidia previously confirmed it was working on a tool that would allow its chips to be located, but it is yet to be released.

The demand for Blackwell Ultra B300 units is driven by the chip's performance capabilities. Announced in March of last year, the data center GPU is among the most powerful available, offering substantial performance gains with 50% more memory and FP4 compute than the preceding B200 generation. At the time of its release, Nvidia described the hardware as built for the age of reasoning. The unit was expected to ship by the end of 2025, and it quickly became a highly sought-after item.

This is not the first time authorities have moved against the unauthorized export of these specific chips. In August 2026, nine individuals were indicted in Taiwan over the illegal export of B300 GPUs to China. That action followed shortly after Supermicro confirmed it had fired several employees after an investigation into smuggling. The smuggling process involved a Taiwanese server trading firm called Flying Tiget Tech, which holds whitelisted status for GPU purchases.

The pressure to obtain Nvidia silicon for AI data centers has created a significant market for processors, extending to older generations as well. Demand for the company's A100 servers has caused prices to triple for hardware that is five years old, with units reaching costs of up to $82,000. The enforcement of export controls has also led some parties to retool gaming GPUs to run AI workloads where possible.

The discovery of restricted accelerators in China Telecom's network highlights the ongoing difficulty in preventing the export of high-performance computing hardware to restricted markets. The finding occurs as global competition for AI infrastructure intensifies, driving up the value of advanced processors. The situation remains fluid as the proliferation of export-controlled chips into China continues to be an issue, even as Nvidia maintains that such activity does not pose a threat to its broader operations.