Trump-Xi Summit Concludes; US Approves H200 Chip Sales to China, Reshaping Nvidia's Revenue

The Trump-Xi summit in Beijing concluded May 15 with unexpected momentumThe empirical fact that winners keep winning over the medium term. on semiconductor trade. The US approved exports of Nvidia's advanced H200 chips to 10 Chinese companies, effectively lifting export restrictions that have crippled China's access to cutting-edge AI compute capacity. This move is significant because China historically accounted for approximately 25% of Nvidia's total revenue, and the prior restriction had forced NVDA to pivot entirely to other geographies, including domestic US, Europe, and allied nations. The approval suggests a tactical reset in US-China tech competition, at least on this specific product line.

Nvidia shares responded immediately, climbing 4.4% on the news. One analyst framed it starkly: 'we approved selling our most advanced AI chips to China while bombing Iran and negotiating with Xi. Geopolitics in 2026.' The tone captures the paradox: elevated geopolitical tension (Iran war) paired with a gesture of tech detente toward China. For Nvidia, this could mean a material uplift to FY 2026 revenue guidanceCompany-issued forecasts of future financial performance. if China-focused demand reignites. The company also reported earnings next Wednesday, and the H200 approval could reframe analyst models positively.

Broad geopolitical implications are more mixed. Trump stated publicly that his relationship with Xi is 'very strong' and that China offered to help resolve the Iran conflict. However, observers noted the summit delivered 'little substantive' beyond optics. Taiwan remained a point of contention, with Chinese media signaling strong messaging on the issue. US Trade Representative Jamieson Greer said he expects China to commit to billions in American agricultural purchases as a carve-out, but no major new trade deals emerged. The absence of concrete progress on tariffs or structural trade imbalances suggests negotiation theater rather than resolution.

For markets, the H200 approval is the headline story. It directly boosts Nvidia's earnings profile and signals US willingness to use tech trade as a negotiation lever rather than a permanent restriction. However, the broader US-China relationship remains adversarial on other fronts: defense, Taiwan policy, and rare earth exports. Tech investors should watch for signs of whether this is a one-off carve-out or the start of a broader reopening of US-China trade in semiconductors.