Nvidia CEO Huang calls AI distillation 'competition,' not theft

September 28, 2026 at 07:29 PM1 min

This digest was compiled by AI from multiple sources — links to the originals are below.

Nvidia CEO Jensen Huang rejected the characterization of AI model distillation as "theft," telling CNBC that learning from competitors' products is "competition." His remarks contrast with Treasury Secretary Scott Bessent, who described distillation as "theft" in July and threatened sanctions against overseas companies using it to extract capability from U.S.-built models.

Key Facts

Nvidia CEO Jensen Huang told CNBC on Monday that AI model distillation is "competition," not theft.
Treasury Secretary Scott Bessent described distillation as "theft" in July and threatened sanctions against overseas companies using it.
The U.S. Cybersecurity and Infrastructure Security Agency accused China's AI companies of conducting "industrial-scale knowledge distillation campaigns."
Anthropic said it found Alibaba and DeepSeek engaging in "illicit distillation."

Huang's Position

Huang told CNBC's Squawk Box that training or learning from competitors' products is "competition." He said companies are allowed to test competitors' products and that Nvidia's products are sometimes stripped "down to bones" as companies try to learn how they work. Huang added that competition makes everything better and that companies can disable their services if they do not want others to use their products.

U.S. Government Response

U.S. officials have accused Chinese AI companies of using distillation to extract capabilities from U.S. systems. Treasury Secretary Scott Bessent called distillation "theft" in July and threatened sanctions against overseas companies that use it. The Cybersecurity and Infrastructure Security Agency accused China's AI companies of conducting "industrial-scale knowledge distillation campaigns" that violated U.S. companies' terms of use.

Industry Allegations

Anthropic said it found Alibaba, which develops the Qwen family of models, and DeepSeek both engaging in "illicit distillation." China has rejected the claims.