Nvidia’s (NVDA) stock fell over 2% on Monday after reports emerged that Chinese tech giant Huawei is readying a new advanced AI chip, the Ascend 910D. The chip, which is still in an early stage of development, is expected to be more powerful than Nvidia’s H100 AI chips.
The news comes as Nvidia disclosed in a regulatory filing this month that the US government had effectively banned exports of its H20 chips made specifically for the Chinese market to comply with ever-tightening US trade rules. The company expects to record a $5.5 billion loss from the policy change, which is estimated to shave up to $16 billion from Nvidia’s revenue this year.
Huawei plans to ship more than 800,000 Ascend 910B and 910C chips to customers, including state-owned telecommunications carriers and AI developers such as TikTok parent ByteDance. The chipmaker’s success in the Chinese market is crucial for its business, with China accounting for $17 billion of Nvidia’s revenue in fiscal year 2025.
Nvidia stock has been declining over the past few months due to investor scrutiny over AI spending from Big Tech giants and Trump’s trade war. The company is also under investigation by the US government over the use of its AI chips in China. However, CEO Jensen Huang recently visited China and met with trade officials, pledging $500 billion to the US AI supply chain buildout.
The development raises questions about Nvidia’s long-term prospects and how it will compete with Huawei in the rapidly evolving AI chip market. With the stakes high, investors are closely watching the company’s next move.
Source: https://finance.yahoo.com/news/nvidia-stock-falls-as-chinas-huawei-reportedly-readies-ai-chip-after-trumps-export-ban-135156741.html