Nvidia shares jumped after hours following news that the U.S. government plans to allow renewed exports of the company’s high‑end AI chips to select customers in China. The policy shift immediately boosted expectations for Nvidia’s data center revenue, as China has historically been one of the company’s largest markets for AI infrastructure.
Why Nvidia Shares Rallied After Hours
A Sudden Policy Shift on China Exports
According to a report from Reuters (link), President Trump stated that the administration will permit Nvidia to ship its H200 artificial intelligence accelerators to approved Chinese buyers. These chips were previously restricted under U.S. export controls designed to limit China’s access to cutting‑edge AI hardware.
The announcement included plans for a per‑chip fee, along with similar export allowances for competitors such as AMD and Intel.
Why the Market Reacted Immediately
China represented a major portion of Nvidia’s data center revenue before export restrictions were introduced in 2022 and tightened in 2023. Nvidia attempted to serve the market by designing lower‑performance, compliance‑aligned GPUs, but demand and pricing power were significantly lower.
Restoring access to full‑performance H200 chips matters because:
- H200 is Nvidia’s flagship AI data center processor for 2024–2025.
- Profit margins on high‑end GPUs are materially stronger than on downgraded export‑compliant variants.
- Hyperscalers and large AI developers in China have expressed pent‑up demand for advanced compute.
- Wall Street has been pricing in limited China growth; reopening even partial access changes revenue expectations quickly.
After the news broke, Nvidia climbed more than 2% in after‑hours trading, building on an already strong session.
Strategic Implications
This shift could reshape Nvidia’s near‑term outlook:
- Revenue Boost: Restored access to China may add billions in additional data center revenue over time if approvals move quickly.
- Stronger Competitive Position: Nvidia regains its technological edge in a market where domestic Chinese chips have been improving.
- Supply Chain Rebalancing: Nvidia may adjust allocation of H200 and successor chips between U.S., global hyperscalers, and newly reopened China demand.
- Policy Uncertainty: Future restrictions could still be introduced, leaving a degree of geopolitical risk in the narrative.