Nvidia, the globally renowned technology company, recently saw its CEO Jensen Huang appear in Beijing to meet with Chinese Vice Premier He Lifeng and other senior trade officials. He emphasized their commitment to developing fully compliant products and continuously expanding their business in China.
This meeting takes place at a time when the U.S. Congress is investigating Nvidia’s actions of selling chips to China. The market widely anticipates that this will further escalate the tech rivalry between the U.S. and China and could potentially have far-reaching impacts on the global chip supply and technological collaboration.
Amid a tightly packed schedule, Jensen Huang not only held discussions with the Vice Premier of China’s State Council but also engaged in a private meeting with DeepSeek founder Liang Wenfeng to explore new-generation chip design solutions tailored for the Chinese market. Additionally, he interacted with organizations such as the China Council for the Promotion of International Trade, leveraging reports from Chinese state media to emphasize Nvidia’s commitment to the Chinese market and its proactive approach to serving it.
At the same time, Washington is stepping up its review of Nvidia’s sales records in the Asian market, scrutinizing for any violations of export restrictions. The House Select Committee on the Chinese Communist Party is leading the investigation, focusing on the details of DeepSeek’s purchase of tens of thousands of high-end chips. Additionally, the H20 chip, which was previously developed to meet export requirements, is now also affected by the latest U.S. policies, with its export to China being officially banned.
This ban has caused severe financial losses for Nvidia, with its market value dropping by $250 billion (approximately HKD 1.95 trillion) at one point. Its stock price fell over 7% on Wednesday, followed by an additional nearly 3% drop on Thursday. According to analysis by Wedbush Securities, this chip ban might signify a new phase in the U.S.-China trade war. Nvidia and the entire U.S. tech industry are facing enormous challenges.
Analysts predict that many tech companies may refrain from providing clear earnings guidance this financial quarter, while Nvidia’s annual revenue forecast for 2025 could face downward pressure of 7 to 10%. Despite significant short-term financial losses, the greater risk actually lies on a strategic level. Last year, Nvidia earned approximately $17 billion (around HK$132.6 billion) from the Chinese market, accounting for over 19% of its total revenue. Losing this market would mean forfeiting a crucial growth driver.
As Beijing hopes for stable chip supplies, Washington continues to review export compliance mechanisms. Jensen Huang’s personal visit to China this time is not only aimed at addressing the crisis but also at attempting to find a balance between market demand and policy. However, as both sides take increasingly firm stances, Nvidia’s dilemma between regulatory compliance and market expansion is set to grow even more complex.
