Nvidia (NVDA) Stock Gains as Trump Approves H200 Chip Sales to China

TLDR

• President Trump announced that Nvidia will be allowed to sell H200 AI chips to approved customers in China with a 25% fee paid to the U.S. government.
• The H200 is Nvidia’s second-best AI chip, nearly six times more powerful than the H20 chips currently permitted for export to China.
• Nvidia shares rose 2% in after-hours trading following the announcement on Truth Social.
• The Commerce Department will finalize the arrangement details, with similar deals available for AMD and Intel.
• It remains uncertain whether China will permit its companies to purchase the H200 chips despite Trump’s claim that President Xi responded positively.

President Donald Trump announced Monday that Nvidia will be permitted to sell its H200 AI processors to approved customers in China. The move comes with a 25% fee on sales paid to the U.S. government.

The H200 represents Nvidia’s second-best AI chip. According to the Institute for Progress, it’s nearly six times more powerful than the H20, which is currently the most advanced chip legally exportable to China.

NVIDIA Corporation, NVDA

Nvidia shares jumped 2% in after-hours trading after the announcement. The stock had already gained 3% during regular trading hours on earlier reports about the potential approval.

Trump Administration Details the Arrangement

The Commerce Department will finalize the specifics of the deal. Trump confirmed the same approach will apply to Advanced Micro Devices and Intel for their AI chip exports.

A White House official explained the 25% fee will be collected as an import tax from Taiwan. The chips will undergo security review by U.S. officials before export to China.

The fee is higher than the 15% rate Trump proposed in August for the less advanced H20 chip. Trump emphasized the arrangement excludes Nvidia’s latest Blackwell and upcoming Rubin chips.

Nvidia released a statement calling the decision a “thoughtful balance that is great for America.” The company noted it would ship to approved commercial customers vetted by the Commerce Department.

Questions Remain About China’s Response

China has effectively banned its technology companies from buying the H20 chip in recent months. Beijing has cautioned Chinese tech firms against purchasing Nvidia chips downgraded for the Chinese market.

Nvidia’s current financial guidance doesn’t assume any revenue from China. Whether Chinese companies will actually be allowed to purchase the H200 remains unclear.

The Chinese foreign ministry said Tuesday that China believes it should cooperate with the U.S. for mutual benefits. George Chen from consultancy The Asia Group expects Chinese regulators to soften their stance on Nvidia following Trump’s comments about Xi’s reaction.

Several Democratic senators called Trump’s decision a “colossal economic and national security failure.” Republican Representative John Moolenaar warned that China would use the chips to strengthen military capabilities.

The Blackwell chip currently used by U.S. AI firms is about 1.5 times faster than H200 chips for training AI systems. For inferencing work, it’s five times faster according to the Institute for Progress.

Trump met with Nvidia CEO Jensen Huang last week. The executive was made aware of the administration’s position on export controls during the meeting.

Intel declined to comment on the announcement. AMD and the Commerce Department did not respond to requests for comment.

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