Nvidia AI Market Impact
Since 2022, Washington has tightened restrictions on the sale of advanced AI chips to China. These controls forced Nvidia to halt shipments of its most powerful products, even as Beijing accused the company of breaking its earlier pledge to treat Chinese customers equally.
In December, U.S. regulators also heightened scrutiny of chip sales, adding pressure on to the company that makes them. “It’s a tough spot,” antitrust lawyers familiar with the case explained. “The company must comply with U.S. export rules but risks angering Beijing for failing to keep its promises.”
Nvidia’s shares dropped roughly 1% following the announcement of China’s probe, reflecting investor concern about its global market access.
The H20 Chip and TikTok Talks
Earlier this summer, former President Trump permitted Nvidia to resume sales of its H20 chip, popular for AI inference tasks. However, Beijing quickly halted purchases, citing cybersecurity concerns. Nvidia maintains its products contain no backdoors or tracking systems.
Both the H20 and a potential new Nvidia AI chip are expected to become bargaining points in the ongoing trade negotiations, which are already entangled with discussions over TikTok’s future in the United States. More on the Mellanox deal here.
