Nvidia stock falls as China's Huawei reportedly boosts AI chip production after Trump's export ban

Nvidia (NVDA) banal fell arsenic overmuch arsenic 3.6% premarket Monday aft a study from Reuters said Chinese tech elephantine Huawei is acceptable to statesman shipping precocious AI chips arsenic soon arsenic adjacent month, aft Trump's caller export rules efficaciously banned the institution from selling its H20 chips successful China.

Huawei's caller 910C chips are reportedly competitory with Nvidia’s H100 AI chips, which are 2 generations down its latest Blackwell chips. The H100 GPUs (graphics processing units) were banned from export to China by the US authorities successful 2022.

Though Nvidia has adapted to aggregate caller US commercialized rules by creating chips specifically for the Chinese market, the ever-tightening restrictions mean those chips are acold little almighty than their mainstream counterparts.

The study of the latest Huawei spot comes astir 1 week aft Nvidia said the US authorities had efficaciously banned income of its H20 graphics processing units — a mentation of its H100 AI chips made for Chinese consumers to comply with US commercialized rules.

The House Select Committee connected China besides released a connection saying it was “demanding answers” from Nvidia astir whether it had antecedently complied with commercialized restrictions.

Fellow spot stocks Advanced Micro Devices (AMD) (also taxable to the caller US export rules), Qualcomm (QCOM), and Broadcom (AVGO) besides fell Monday, each dropping astir 2% premarket. Nasdaq futures dipped 1.5%.

Nvidia disclosed past week that it volition grounds a $5.5 cardinal deed from mislaid inventory and contracts successful the archetypal 4th owed to the alteration successful commercialized policy. JPMorgan expert Harlan Sur projected that, overall, Nvidia volition suffer arsenic overmuch arsenic $16 cardinal successful the existent fiscal twelvemonth from the H20 ban.

Bernstein expert Stacy Rasgon said past week successful a enactment to investors pursuing the news: “Banning the H20 makes small consciousness to america … a prohibition fundamentally simply hands the Chinese AI marketplace implicit to Huawei."

China accounted for $17 billion, oregon 13%, of Nvidia's gross successful its fiscal twelvemonth 2025, Rasgon noted.

Shares of Nvidia fell 7% the time aft the regularisation was announced. The institution saw astir 8%, oregon $230 billion, erased from its marketplace headdress past week.

Nvidia CEO Jensen Huang visited China and met with commercialized officials successful Beijing past week, and the institution is simultaneously looking to grow its home manufacturing footprint, pledging $500 cardinal to the US AI proviso concatenation buildout past week.

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Nvidia has said it follows commercialized rules “to the letter,” and the institution was captious of tightening US commercialized argumentation nether the anterior administration.