Despite President Donald Trump‘s approval of Nvidia Corp.‘s (NASDAQ:NVDA) export of H200 chips to China, the sales are reportedly still pending final clearance from the U.S. government.
State Dept Review Delays China Chip Sales
The U.S. government is now reviewing the licenses to ensure that appropriate conditions are attached. The Commerce Department has completed its analysis, but the State Department is reportedly pushing for tougher restrictions, as per a report by the Financial Times on Wednesday.
The State Department is currently conducting a national security review before granting licenses to Chinese customers.
Advanced Micro Devices Inc. (NASDAQ:AMD) CEO Lisa Su also confirmed during the company’s earnings call on Tuesday that her company is awaiting U.S. licenses to ship its MI325X chip under the same December deal.
Chris McGuire, senior fellow for China and emerging technologies at the Council on Foreign Relations, told the publication that the State Department concerns highlight “real and significant” national security risks that should not be ignored.
Chinese customers, meanwhile, are holding off on H200 chip orders from Nvidia as they await clarity on licensing approvals and any conditions that may apply.
Alibaba Steps Up As Nvidia Waits
In December, Nvidia’s CEO, Jensen Huang, secured a deal with Trump that raised hopes of Nvidia’s return to the Chinese market, which Huang believes could be worth $50 billion annually. However, the formal approval from the Trump administration came in January.
The delay in the final approval of Nvidia’s H200 AI chip sales to China could have significant implications for the company’s market position and revenue. Alibaba Group Holding Ltd. (NYSE:BABA) unveiled a high-end, self-developed AI chip through its T-Head unit, aiming to cut reliance on Nvidia.
Earlier in January, Beijing reportedly approved the import of the first batch of Nvidia’s H200 chips during Huang’s recent trip to China, with initial approvals granted to three major Chinese internet firms.
This was followed by reports that DeepSeek, a Chinese AI startup, was seeking to purchase Nvidia’s top-tier chips, despite initial fears of shrinking demand. The report also stated that China’s industry and commerce ministries have granted the approvals, while the National Development and Reform Commission, the country’s top economic planner, is still finalizing the conditions.
Benzinga’s Edge Rankings place Nvidia in the 97th percentile for quality and the 94th percentile for growth, reflecting its strong performance in both areas. Benzinga’s screener allows you to compare Nvidia’s performance with its peers.
Price Action: Over the past year, Nvidia stock surged 54.59%, as per data from Benzinga Pro. On Tuesday, the stock edged 2.84% higher to close at $180.34.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Michael Vi / Shutterstock
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