Nvidia to sell 260,000 Blackwell AI chips to South Korea; the chips US has 'national security' restrictions on

Nvidia has made a landmark deal to supply more than 260,000 Blackwell AI chips to South Korea. As reported by Reuters, the deal comes despite the chips being subject to US national security export restrictions, underscoring the strategic importance of AI hardware in global tech alliances. The report adds that the chips made by Nvidia will be distributed across South Korea’s public and private sectors, including players like Samsung, SK Group and Hyundai Motor Group, to power large-scale AI data centers and “AI factories.” These facilities are said to support advancements in robotics, semiconductors, cloud infrastructure and autonomous vehicles.


Navigating US restrictions

The Blackwell chips are Nvidia’s most advanced AI processors and are also among the technologies restricted by the US government for export to certain countries, particularly China over concerns of military and surveillance applications. On the other hand, South Korea is a close ally of US and it is not subject to the same bans imposed on China. Nvidia has not yet disclosed the financial terms or licensing details of the agreement, but the company has revealed that the chips will be used for commercial and research purposes.


Fueling Korea’s AI ambitionsAs reported by Reuters, the South Korean government has made AI a national priorityand it aims to build a strong ecosystem that rivals global tech hubs. President Lee Jae-myung’s administration has pledged significant investment in AI infrastructure, and the Nvidia deal is seen as a cornerstone of that strategy. “Just as Korea’s physical factories powered industrial growth, these AI factories will drive digital transformation,” said a government spokesperson.

The chips will be used to build high-performance computing clusters capable of training large language models and supporting generative AI applications across industries.


Nvidia’s global expansion

The announcement comes as Nvidia continues its meteoric rise, recently surpassing a $5 trillion market valuation. The South Korea deal adds to a series of global partnerships, including recent agreements in Japan, India, and the Middle East, as demand for AI infrastructure accelerates worldwide. CEO Jensen Huang, who attended the APEC CEO Summit in Gyeongju, praised South Korea’s commitment to AI leadership and called the deal “delightful.”