Semiconductor Stocks Rise Amid AI Boom and US-China Trade Deal

Semiconductor stocks are trending as big tech giants invest aggressively in AI, fueling demand for AI chips, processors, and equipment. The US-China trade deal allowing Nvidia and AMD to sell AI chips in China with a 15% profit share removes a significant growth barrier in the AI boom, signaling further upside for AI-related tech stocks. The US leads China in AI for the first time in 30 years, with companies like Nvidia, Microsoft, and Google driving the global AI revolution.

Semiconductor stocks are trending upwards as big tech giants, including Nvidia and AMD, invest aggressively in artificial intelligence (AI), driving demand for AI chips, processors, and equipment. The recent US-China trade deal, which allows these companies to sell AI chips in China with a 15% profit share, has removed a significant growth barrier in the AI boom, signaling further upside for AI-related tech stocks.

The deal, brokered by the Trump administration, enables Nvidia and AMD to obtain export licenses to sell their H20 and MI308 chips in China. This arrangement is part of a broader strategy to maintain US dominance in AI while preserving trade ties with China. The deal came to fruition after Nvidia CEO Jensen Huang met with President Donald Trump, who agreed to lift export controls in exchange for a revenue-sharing arrangement [1].

China's push for self-sufficiency in semiconductor technology has been a key driver in the geopolitical landscape. The country aims to achieve 55% AI chip market share by 2027, potentially reducing its reliance on foreign technology. This ambition, coupled with the US-China trade dynamics, creates a complex web of risks and opportunities for semiconductor companies like Nvidia [2].

The US leads China in AI for the first time in 30 years, with companies like Nvidia, Microsoft, and Google driving the global AI revolution. The recent trade deal underscores the strategic importance of AI chips in the global tech ecosystem. As the AI market continues to grow, the demand for high-performance processors and related equipment is expected to rise, benefiting companies that can navigate the geopolitical landscape effectively.

Investors are closely watching how the trade deal will impact Nvidia's stock valuation. The company's resilience in 2025, with a 56.6% 90-day gain, contrasts with the geopolitical risks, including potential restrictions on the export of Nvidia's Blackwell chip. The 15% revenue-sharing agreement with the US government adds a layer of margin compression, but it also opens new markets for Nvidia and AMD [2].

In conclusion, the US-China trade deal is a significant development for the semiconductor industry. It removes a growth barrier for AI-related tech stocks and signals further upside potential. As the global AI revolution continues, companies that can effectively navigate the geopolitical landscape and capitalize on market opportunities are likely to see substantial benefits.

References:
[1] https://www.cnn.com/2025/08/11/china/us-china-trade-nvidia-chips-intl-hnk
[2] https://www.ainvest.com/news/nvidia-strategic-exposure-china-policy-risk-geopolitical-licensing-decisions-impact-ai-chip-demand-stock-valuation-2508/