Nvidia placed orders for 300,000 H20 chipsets with contract manufacturer TSMC last week, two sources said, with one of them adding that strong Chinese demand had led the U.S. firm to change its mind about just relying on its existing stockpile.

In the meeting, Chinese regulators demanded that the U.S. chip company provide explanations on “backdoor safety risks” of its H20 chips to be sold in China and submit relevant materials, the office said.

This week, the country's top internet watchdog summoned Nvidia reps over what it calls serious security risks tied to the H20 chipa product Nvidia designed specifically to meet U.S. export rules. State media pulled no punches either.