Nvidia (NVDA, Financials) Chief Executive Officer Jensen Huang traveled to China last week, looking to steady the company's ties in the region as new U.S. export rules threaten billions in sales.
Huang met senior officials including Ren Hongbin, head of the China Council for the Promotion of International Trade, and said Nvidia hoped to “continue to cooperate with China,” according to Chinese state media. He also met Shanghai's mayor and visited Liang Wenfeng, founder of AI company DeepSeek.
The visit came just as the U.S. Commerce Department tightened export controls, requiring licenses for Nvidia to sell its H20 AI chips to China. The department cited national and economic security concerns and said the rules would apply indefinitely.
Nvidia expects to lose about $5.5 billion in orders from Chinese tech giants like Tencent (TCEHY, Financials), Alibaba (BABA, Financials), and ByteDance. No grace period was offered to fulfill pending shipments.
The H20 chip was originally designed to comply with earlier restrictions. But DeepSeek's recent success in developing generative AI using less powerful hardware renewed U.S. fears about China's tech progress.
Analysts said the new limits could push China to speed up efforts to build better AI chips through firms like Huawei, though domestic options still lag behind Nvidia's.
The move highlights a wider split in global technology between U.S. and China-based systems. In response, Nvidia plans to invest up to $500 billion in AI servers in the United States, while Taiwan Semiconductor Manufacturing Company (TSM, Financials) is expanding chip production in Arizona with a $100 billion investment.
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