Nvidia CEO Jensen Huang has publicly addressed growing market concerns about artificial intelligence potentially replacing traditional software and related tools, firmly dismissing such fears as "illogical." His comments came in direct response to significant market turbulence that affected software stocks globally.

Market Response to AI Concerns

Global software stocks experienced a notable selloff on Tuesday, reflecting investor anxiety about the potential impact of artificial intelligence on traditional software companies. The market reaction highlighted growing concerns within the technology sector about AI's disruptive potential.

CEO's Position on AI and Software

Huang's dismissal of replacement fears suggests a more complementary relationship between AI and existing software tools rather than a substitutional one. The Nvidia CEO's characterization of such concerns as "illogical" indicates his belief that AI will likely enhance rather than eliminate traditional software applications.

Industry Implications

The timing of Huang's comments, following the software stock selloff, underscores the ongoing debate within the technology industry about AI's role in reshaping software development and deployment. His statement may serve to reassure investors and industry stakeholders about the continued relevance of traditional software tools in an AI-driven landscape.

Nvidia CEO Jensen Huang is currently visiting China for annual employee celebrations, but his trip comes amid unexpected complications as Chinese customs authorities have blocked imports of the company's H200 chips without providing any explanation.

Shanghai Visit and Extended China Tour

According to Reuters, Huang arrived in Shanghai for routine annual celebrations with Nvidia employees scheduled for 24 January. However, sources indicate his trip will extend beyond Shanghai to include visits to Beijing, Shenzhen and Taiwan. This marks another significant visit by the Nvidia chief to China, following at least three trips to the country in 2025 amid ongoing US-China trade tensions.

H200 Chip Import Restrictions

Chinese customs authorities informed a Shenzhen logistics company last week that Nvidia's H200 chips are not permitted entry into the country. The restrictions caught Nvidia by surprise, particularly as early shipments had already arrived in Hong Kong during the week. Sources told the Financial Times that no reason was provided for the block, and there is no indication whether this represents a temporary measure or a permanent ban.

The timing of these restrictions is particularly notable given recent developments in US-China chip trade relations. In December, Donald Trump had allowed the Santa Clara, California-based company to export H200 chips to Chinese markets, a decision that came after months of lobbying efforts by Huang with both the Trump administration and Chinese officials.

Impact on Chinese Tech Giants

The customs restrictions are creating ripple effects across China's technology sector. Domestic tech companies have reportedly been warned against purchasing Nvidia chips and advised to prioritise domestic alternatives instead. This guidance is influencing purchasing decisions at major Chinese technology companies.

These companies are now considering limiting H200 chip purchases to only those projects that specifically require higher performance capabilities and easier maintenance, rather than broader deployment across their operations.

Ongoing US-China Chip Tensions

The current situation reflects the complex dynamics of US-China technology trade relations. Throughout 2025, Huang has maintained active engagement with Chinese markets despite broader restrictions on US chip exports to China. His previous meetings included discussions with China's commerce minister in July, demonstrating the ongoing importance of diplomatic engagement in the semiconductor sector.

The uncertainty surrounding the H200 chip restrictions highlights the challenges facing international technology companies operating across geopolitical boundaries, where trade policies can shift rapidly and impact established business relationships.