Nvidia Corp (NASDAQ:NVDA, XETRA:NVD) shares moved higher in early trade on Friday after a Bloomberg report said China is preparing to allow major technology firms to place orders for the company’s H200 artificial intelligence chips.
According to the report, Chinese officials have told the country’s largest tech companies, including Alibaba Group, that they can begin preparing orders for Nvidia’s H200 chips, signaling Beijing may be close to formally approving imports of advanced AI components.
Regulators have granted in-principle approval for Alibaba, Tencent Holdings and ByteDance to move to the next stage of purchase preparations, people familiar with the matter said. This stage allows the companies to discuss details such as required volumes, according to the sources.
Bloomberg also reported that Beijing is expected to encourage companies to purchase a certain amount of domestically produced chips as a condition of approval, though no specific thresholds have been set.
Wedbush analysts said the development could be meaningful for US chipmakers. “Per Bloomberg, China has told large CSPs that they can prepare orders for H200 parts and discuss specifics of such orders with NVDA, suggesting the country is close to formally approving imports of the US AI chips,” the analysts wrote.
They believe such an outcome “would represent a significant near-term positive for NVDA (and AMD) given the size of the China market, the magnitude of past orders, and previously reported speculated order figures for H200s from large China CSPs assuming H200 shipments are allowed.”
Shares of Nvidia were 1.6% higher on the news, while Advanced Micro Devices Inc (NASDAQ:AMD, XETRA:AMD) added 2.8%.