Nvidia to resume H20 chip sales to China after U.S. assures export licenses

Nvidia plans to resume sales of H20 GPUs to Chinese clients after receiving U.S. government approval for export licenses, expressing optimism about commencing deliveries soon.

The sales of these GPUs were previously suspended due to export restrictions, which have significantly reduced Nvidia's market share in China by approximately 50%.

Nvidia's CEO, Jensen Huang, criticized U.S. chip export restrictions and introduced a new compliant chip, the RTX PRO, while promoting U.S. job creation and collaboration in AI technology with both government and Chinese officials.

The developments reflect Nvidia's strategy to navigate international trade complexities while maintaining its innovation and market presence in both the U.S. and China.

Recommendation Rating: Positive Outlook for Nvidia's Chinese Market Strategy

Nvidia (NASDAQ: NVDA) announced on Tuesday its intention to recommence sales of H20 GPUs to Chinese clients, following assurances from the U.S. government regarding the approval of export licenses. In a statement, the company expressed optimism, indicating that it anticipates commencing deliveries shortly.

Sales of these GPUs were suspended in April, despite the fact that the chips were engineered to navigate existing export restrictions. This development aligns with a preliminary trade agreement established last month, which aimed to facilitate the resumption of China's rare earth exports while the U.S. would consider easing its restrictions on technology exports.

Nvidia's CEO, Jensen Huang, has openly criticized the chip export restrictions, arguing that they undermine the United States' technological leadership and have resulted in a significant reduction—approximately 50%—in Nvidia’s market share in China.

In addition to addressing these trade concerns, Huang announced the introduction of a new compliant chip, the RTX PRO, designed specifically for smart factories and logistics applications. Recently, he engaged with President Trump to advocate for U.S. job creation, onshoring initiatives, and advancements in artificial intelligence leadership. Huang also met with officials from China to discuss the importance of enhancing safe collaborations in AI technology.

Overall, these recent developments signal Nvidia's proactive approach to navigating the complexities of international trade and technology exports, with an eye toward sustaining its market presence and innovation in both American and Chinese markets.