Nvidia stock surges after China chip sales resumption.

Nvidia's shares surged 4.5% after the company announced it expects to resume shipments of its H20 AI chip to China, a potential reversal of months of halted sales due to US export controls. The US government assured Nvidia that licenses will be granted, and the company hopes to begin deliveries soon. Nvidia CEO Jensen Huang has argued that locking Nvidia out of the Chinese market would accelerate China's chip-making capabilities and push business toward domestic Chinese rivals. The rally lifted several major ETFs, including the SPDR S&P 500 ETF Trust, Invesco QQQ Trust, and VanEck Semiconductor ETF.

Nvidia's shares surged 4.5% after the company announced it expects to resume shipments of its H20 AI chip to China, a potential reversal of months of halted sales due to U.S. export controls. The U.S. government assured Nvidia that licenses will be granted, and the company hopes to begin deliveries soon. Nvidia CEO Jensen Huang has argued that locking Nvidia out of the Chinese market would accelerate China's chip-making capabilities and push business toward domestic Chinese rivals. The rally lifted several major ETFs, including the SPDR S&P 500 ETF Trust, Invesco QQQ Trust, and VanEck Semiconductor ETF.

The news comes after months of uncertainty surrounding Nvidia's ability to sell its H20 chips in China. In April, the U.S. government required Nvidia to obtain a license for selling these chips, effectively halting their sales. The H20 chips were designed to bypass earlier export controls on Beijing and were seen as a less powerful alternative to Nvidia's flagship AI processors. The potential resumption of H20 chip sales marks a significant development for Nvidia, which had been facing financial consequences due to the suspension of exports. The company reported a $5.5 billion writedown on unsold H20 inventory in May [2].

Nvidia CEO Jensen Huang has been actively lobbying against export controls, arguing that they inhibit American tech leadership. In a recent meeting with U.S. President Donald Trump, Huang reaffirmed Nvidia's support for the administration's job creation and onshoring efforts, as well as the aim for America to lead in global AI. The potential change in U.S. stance follows a preliminary trade framework agreement between Washington and Beijing that relaxed rare-earth export controls by China and eased tech export curbs by the U.S. [1].

Huang also announced a new "fully compliant" GPU — RTX PRO — which he said was ideal for smart factories and logistics. It was not clear if the reference was to the GPU being compliant with guidelines for exports to China. Since May, reports had indicated that Nvidia was working on a new AI chip for the China market, which would be less advanced than the H20. However, the potential resumption of H20 chips to China comes as a surprise, according to Ray Wang, research director of semiconductors, supply chain, and emerging technology at Futurum Group [1].

The resumption of H20 shipments, alongside the upcoming rollout of new export control-compliant AI chips for the Chinese market, should serve as a fresh growth catalyst in the coming quarters, Wang said. Nvidia has confirmed that Huang was in China where he met with government and industry officials to discuss the benefits of AI and ways for researchers to advance safe and secure AI [1].

China remains a key market for Nvidia, despite mounting restrictions and increasing competition from domestic firms like Huawei. In a meeting with Chinese Vice Premier He Lifeng in April, Huang expressed a long-term commitment to the Chinese market and emphasized Nvidia’s intention to support U.S.-China trade relations. The Chinese market contributed $17 billion in sales—equivalent to 13% of the company’s global revenue—in the fiscal year ending Jan. 26 [2].

The rally in Nvidia's shares also lifted several major ETFs, including the SPDR S&P 500 ETF Trust, Invesco QQQ Trust, and VanEck Semiconductor ETF. Investors are optimistic about the potential growth opportunities in China and the broader semiconductor sector.

References:
[1] https://www.cnbc.com/2025/07/15/nvidia-says-us-government-will-allow-it-to-resume-h20-ai-chip-sales-to-china.html
[2] https://www.turkiyetoday.com/business/nvidia-to-resume-h20-ai-chip-shipments-to-china-as-us-eases-export-curbs-3204262