NVDA Stock Hovers Near $6 Trillion Market Cap, US Reportedly Clears Path for AI Chip Sales to China

• Approved Chinese firms include Alibaba, Tencent, and ByteDance.
• Lenovo and Foxconn win US approval as Nvidia’s H200 distributors.
• Nvidia’s server assembly partner Hon Hai Precision reported robust quarterly results.

Nvidia (NVDA) share price gained about 1% after-hours, with the company’s market cap hovering near the $6 trillion mark, after media reports suggested that the U.S. cleared a path for the chipmaker to sell its AI chips in China, while a key AI hardware partner reported stellar quarterly results.

The $6 trillion milestone comes as the U.S. government cleared the sale of Nvidia’s advanced H200 chips to 10 major Chinese firms, including Alibaba, Tencent, and ByteDance, Reuters reported. The move coincides with a high-stakes visit to Beijing by Nvidia CEO Jensen Huang, who joined a U.S. delegation led by President Donald Trump to meet with Chinese President Xi Jinping. 

The explosive growth of Nvidia has served as one of the primary growth drivers for the U.S. equity markets so far this year, with investor appetite for artificial intelligence hardware driving benchmark stock indices to record highs.

Nvidia has also significantly outperformed the broader tech-heavy Nasdaq 100 so far this year, owing to the AI gold rush. 

While domestic U.S. demand for AI hardware and software remains insatiable, the newly minted China deal is seen as a critical relief valve for Nvidia. Re-entering the world’s second-largest economy could unlock billions in stalled revenue and prevent Chinese tech giants from permanently pivoting to homegrown alternatives like Huawei. 

"Any deal that allows Nvidia to sell more chips to China means fewer Nvidia chips for U.S. firms, and a smaller U.S. lead in AI over China," said Chris McGuire, senior fellow ​for China and emerging technologies at the Council on Foreign Relations, told Reuters. "It is remarkable that President Trump keeps getting convinced to put Nvidia’s interest ahead of America’s."

Evidence of the AI gold rush was further bolstered Thursday by Nvidia’s primary manufacturing partner, Hon Hai Precision Industry, better known as Foxconn, on its robust earnings. The Taiwanese electronics giant reported a significant jump in quarterly profit, driven almost entirely by a 30% rise in revenue from AI server sales, further bolstering NVDA’s share price.

The NVDA-China Chip Deal 

Despite the U.S. clearing the H200 sales, no chips have yet been delivered. Beijing has reportedly signaled to its own domestic firms to prioritize Chinese-made chips. Under the terms of the U.S. license, each of the 10 approved Chinese companies is permitted to purchase up to 75,000 H200 units—Nvidia’s second-most powerful AI processor.

According to the arrangement between the U.S. and China, the U.S. government is set to receive 25% of the revenue from these specific China sales. To facilitate this, the chips must pass through U.S. territory before being exported to China.

The stakes for Nvidia are immense. Before export controls were tightened in 2023, China accounted for approximately 95% of Nvidia’s advanced chip market and 13% of its total revenue. Jensen Huang, Nvidia’s chief, has previously estimated that China’s AI market alone could be worth $50 billion annually. 

Lenovo and Foxconn, along with a handful of others, have been selected as the official distributors for the H200 chip sales in China. 

NVDA’s H200 Chip 

Nvidia’s flagship H100 and H200 chips are backordered by months globally, with major customers like Microsoft, Meta, and Google-parent Alphabet. If the deadlock in Beijing is broken, Nvidia intends to ship up to 750,000 H200 chips to the Chinese market in the first phase of the rollout, potentially adding tens of billions to its bottom line. 

Speaking to Chinese state broadcaster CCTV on Thursday, Huang expressed optimism that the "good relationship" between Trump and Xi would foster a breakthrough. 

NVDA Retail View 

Retail Sentiment on Stocktwits was “extremely bullish” with “extremely high” message volumes. 

One user expressed optimism by saying the stock was “moving with purpose.

The stock has gained 26% year-to-date.

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