US Approves H200 Chip Exports to 10 Chinese Firms; NVDA Eyes China Revenue Recovery

In a surprising reversal of US export restrictions, the Biden-Trump administration approved sales of Nvidia's cutting-edge H200 AI chips to a select group of 10 Chinese companies on May 15. The move marks a dramatic shift in US-China technology competition and signals that Washington may be softening its stance on advanced chip exports amid ongoing diplomatic engagement. Nvidia alone had faced restrictions that cut off China as a customer for years, resulting in the loss of roughly 25 percent of the company's total revenue.

The approval comes as President Trump concluded a two-day summit in Beijing with President Xi Jinping. While the summit produced a "choreographed script" with few substantive trade concessions, sources indicate that technology negotiations proceeded on parallel tracks. Trump stated that Xi offered to assist in resolving the Iran crisis, and the chip approval may reflect broader US-China signalling that both sides are willing to dial back certain contentious tech restrictions in exchange for diplomatic cooperation elsewhere.

Nvidia's stock reaction was swift: the company jumped 4.4 percent on the news, reflecting investor relief that the China revenue headwind may be reversing. Analysts note that NVDA's leadership position in AI compute makes it essential to Chinese tech development, and China's willingness to buy from Nvidia signals either that Beijing's own chip efforts have stalled (requiring continued reliance on US suppliers) or that Washington's geopolitical calculus has shifted. Some traders expressed shock at the decision, noting that it contradicts the "bombing Iran" narrative and suggests Trump's approach to China is transactional rather than ideological.

The longer-term implication is unclear. Critics warned that this approval may be temporary or conditional on further negotiations. Others noted that opening China to advanced US chips could accelerate Chinese AI development, which some see as a strategic mistake. However, Nvidia investors and chipmakers broadly cheered the approval as it potentially unlocks a $10+ billion revenue stream that had been off-limits for two years.