The Trump administration removed a major overhang on Nvidia stock when it cleared the chipmaker to resume selling its H20 artificial intelligence chips in China.
Santa Clara, Calif.-based Nvidia announced late Monday that the U.S. government plans to grant licenses for the company to sell its H20 graphics processing units in China. The Trump administration had halted sales of those chips to China in April over national security concerns.
The U.S. government's change of heart came after Nvidia Chief Executive Jensen Huang met with President Donald Trump and federal policymakers in Washington, D.C. Huang reaffirmed Nvidia's support for the administration's effort to create jobs, strengthen domestic AI infrastructure and onshore manufacturing, and ensure that America leads in AI worldwide.
Huang also met with Chinese government and industry officials in Beijing this week.
On the stock market today, Nvidia stock rose 4% to close at 170.70. In intraday trading on Tuesday, it hit an all-time high of 172.39.
The news also lifted shares of Nvidia's contract manufacturer, TSMC, and rival AMD.
TSMC stock climbed 3.6% to close at 236.95. AMD stock surged 6.4% to end the regular session at 155.61.
The U.S. Department of Commerce informed AMD that license applications to export its MI308 chips to China will be moving forward for review, Reuters reported.
Nvidia Stock Is On Four IBD Lists
Removal of the China export restrictions is a "watershed moment" for Nvidia, the "AI revolution" and the U.S. tech industry, Wedbush Securities analyst Daniel Ives said in a client note.
At least seven Wall Street firms raised their price targets on Nvidia stock on Tuesday.
Melius Research analyst Ben Reitzes reiterated his buy rating on Nvidia stock and upped his price target to 235 from 205.
"Nvidia getting back in China after a mid-April ban is a huge tailwind," Reitzes said in a client note. "We wouldn't be surprised if all or most of the $8 billion run rate per quarter in lost China sales came back completely by fiscal Q4 2026, given pent-up demand, and boosted fiscal 2027 overall revenue growth to 38% year over year after 59% growth in fiscal 2026."
Nvidia stock is on four IBD lists: IBD 50, Leaderboard, Sector Leaders and Tech Leaders.
Follow Patrick Seitz on X at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
