Nvidia to Resume H20 Chip Sales in China, Unveils New Processor Amid Trade Easing
NVIDIA Corporation (NASDAQ: NVDA) announced Monday evening that it will soon restart sales of its H20 processor in China, signaling improved trade relations between the U.S. and China. The announcement came as CEO Jensen Huang held meetings with officials from both countries.
In addition to resuming H20 sales, Nvidia introduced a new GPU designed specifically for the Chinese market, which it says is well-suited for AI-powered smart factories and logistics applications.
The news drove Nvidia’s stock up 4% by the close of Tuesday’s session.
Huang informed customers that the company is in the process of “filing applications to sell the Nvidia H20 GPU again,” adding that the U.S. government has assured Nvidia that export licenses will be granted, according to a company statement. Nvidia is currently the world’s most valuable publicly traded company.
This development follows the Biden administration’s decision to ease export restrictions on certain semiconductor technologies to China. U.S. authorities have also recently allowed firms such as Synopsys (NASDAQ: SNPS) to resume sales in China.
Earlier this year, Nvidia had been effectively barred from selling the H20 chip in China due to stricter export controls implemented under President Trump. The company had previously warned of a $5.5 billion financial hit tied to those restrictions, as China remains a crucial market for its products.
However, trade relations have since improved, with Washington and Beijing agreeing to significantly roll back tariffs in May and June.
The H20 chip, tailored to comply with earlier Biden-era restrictions, has become highly popular among Chinese AI developers and is used by major tech firms such as DeepSeek, Tencent, Baidu (NASDAQ: BIDU), and Alibaba (NYSE: BABA).
Nvidia had repeatedly cautioned that tighter U.S. rules could jeopardize its access to the Chinese market. CEO Huang previously described the export controls as a “failure.”
According to William Blair analyst Sebastien Naji, the resumed China business could contribute an additional $0.30 to Nvidia’s earnings per share in fiscal 2026, based on projected China revenue of $20 billion, up from $17.1 billion in fiscal 2025. Naji also suggested the renewed China activity may provide a boost to gross margins in the second half of the fiscal year.
The announcement prompted several analysts to raise their price targets for Nvidia:
- Oppenheimer’s Rick Schafer increased his target from $175 to $200
- Melius Research’s Benjamin Reitzes lifted his forecast to $235
- DZ Bank adjusted its target to $195
- Bank of America (BofA) raised its estimate to $220
- Mizuho also boosted its target to $195
