Nvidia Stock Surges on US Review of H200 Chip Sales to China
Commerce Department to review export licenses for advanced AI chips, signaling a potential reopening of a lucrative market for the semiconductor giant.
Nvidia Corp. (NASDAQ: NVDA) shares jumped more than 3% in Tuesday trading after the U.S. Commerce Department initiated a review to grant licenses for the sale of the company’s advanced H200 artificial intelligence chips to China, a move that could reopen a major revenue channel largely cut off by recent trade restrictions.
The stock climbed by as much as 3.3%, adding over $130 billion to its market capitalization and pushing its valuation to approximately $4.3 trillion. Shares were trading at $179.90 in the afternoon, buoyed by the prospect of renewed access to one of the world's largest AI markets.
The review marks a potentially significant pivot in U.S. trade policy. For the past two years, Washington has progressively tightened controls on the export of high-performance semiconductors to China, citing national security concerns. These restrictions have directly impacted Nvidia, which previously counted on China for a significant portion of its revenue. According to recent financial disclosures, revenue from China and Hong Kong accounted for just 7.6% of Nvidia's total for the first nine months of 2025, a steep decline from 26% in 2021 before the strictest controls were implemented.
The chip at the center of the review, the Nvidia H200 Tensor Core GPU, is the company's second-most powerful AI accelerator. Unveiled in late 2023 as a successor to the highly sought-after H100, the H200 features 141GB of next-generation HBM3e memory and delivers nearly double the inference speed of its predecessor. The U.S. government's prior restrictions, including those from October 2023, effectively banned the sale of both the H100 and its less powerful, China-specific variant, the H800, forcing Chinese tech giants to seek less effective alternatives.
This policy shift appears to be part of a new strategy that balances economic interests with security oversight. According to a report from Fox Business, the Trump administration has signaled its support for a one-year waiver on the H200 export ban, tied to a proposal where the U.S. government would receive a 25% share of the revenue from these sales. This framework would allow America's leading chip designer to capitalize on Chinese demand while providing the U.S. with direct economic benefits and a measure of control.
The Commerce Department's formal review will now undergo a 30-day period for input from other government bodies, including the Departments of State, Energy, and Defense. While the administration's support suggests a likely path to approval, these agencies will weigh the strategic implications of allowing one of the most advanced U.S. technologies to be sold to a primary competitor.
The news sent a bullish signal through the semiconductor sector, as investors wager that Nvidia may soon reclaim a market it was forced to abandon. The potential revenue from China could be substantial, providing another catalyst for a stock that has already seen monumental growth driven by the global AI boom.
Analysts have overwhelmingly maintained a positive outlook on Nvidia, with 60 of 64 analysts covering the stock rating it as a "buy" or "strong buy." The potential for renewed China sales could lead to upward revisions of already lofty price targets, as the company continues to solidify its dominance in the AI infrastructure market. The move also complicates the landscape for domestic Chinese chipmakers, who had been racing to develop alternatives to fill the void left by Nvidia's absence.