President Donald Trump’s administration is reportedly contemplating the possibility of permitting Nvidia Corp. (NASDAQ:NVDA) to trade its H200 artificial intelligence chips with China.
What Happened: According to a report, the Trump administration’s internal discussions indicate a significant deviation from its previous stance on semiconductor export controls. However, this potential move remains a subject of debate, with no final decision taken as of yet.
The ongoing discussions are being perceived as a potential win for Nvidia’s CEO, Jensen Huang, who has been advocating for a relaxation of export controls.
Following the news of these discussions, Nvidia’s shares experienced a surge, reaching a session high on Friday, with a gain of up to 2% at $184.29, reports Bloomberg.
Despite the ongoing discussions, Nvidia stated that the current regulations are a hindrance to offering a data center product in China, thereby leaving the market open to its rapidly growing foreign competitors.
Also Read: Jensen Huang And Nvidia: Riding High On AI, But For How Long?
The proposed sale of H200 chips to China could signify a substantial relaxation of US trade restrictions aimed at limiting China’s advancement in artificial intelligence. However, this move is expected to face resistance from China hawks in Washington.
As of now, representatives from the White House and the Commerce Department, which regulates exports, have not commented on the H200 discussions.
Why It Matters: The proposed sale of Nvidia’s H200 AI chips to China could have far-reaching implications. It could potentially open up a new market for Nvidia, boosting its sales and profits. However, it may also escalate tensions between the US and China, given the ongoing trade war and the sensitive nature of AI technology.
The move could also face backlash from lawmakers and other stakeholders who are concerned about China’s growing prowess in AI.
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