Nvidia Corp has officially begun shipping its powerful H200 artificial intelligence chips to China, signaling a resumption of advanced hardware exports under strict case-by-case government licenses. A top U.S. trade official confirmed the development, while KeyBanc maintained an Overweight rating on the stock and raised its price target to $330 from $310, citing robust global demand and supply chain progress. The regulatory approvals and analyst optimism highlight Nvidia's strategic position despite geopolitical tensions and hardware rollout delays.

H200 Shipments Remain Limited

Jeffrey Kessler, Under Secretary of Commerce for Industry and Security, stated that early volumes remain heavily restricted, describing initial deliveries as "trivial" and "very few". Despite tight restrictions, recent U.S. approvals have cleared around 10 Chinese firms to receive advanced AI hardware from Nvidia and Advanced Micro Devices Inc. Major tech conglomerates—including ZTE Kangxun Telecom, a unit of ZTE Corp, Alibaba Group Holding Ltd ADR, Tencent Holdings Ltd, ByteDance, Maginfra, and a Kingsoft subsidiary—are among the entities cleared to purchase the chips. Kessler emphasized that applicants must satisfy rigorous national security benchmarks and submit to inspections to guarantee compliance.

China Revenue Declines Amid Policy Hurdles

Nvidia sharply reduced its China exposure over the past year, even as its overall AI-driven revenue surged. Revenue from customers based in China, including Hong Kong, fell about 53% to $4.55 billion in the first quarter from $9.66 billion a year earlier, according to Nvidia's Form 10-Q. Despite that drop, total revenue jumped 85% year over year to a record $81.6 billion. Chinese authorities have slowed local purchases of U.S.-designed AI chips, partly because Beijing wants to support its domestic chip industry. Nvidia has told investors it does not expect additional near-term AI processor revenue from China, even after U.S. approval for H200 sales.

KeyBanc Raises Nvidia Forecast

KeyBanc analyst John Vinh described the company's supply landscape as "mixed but mostly positive." While Asia field checks reveal that the upcoming Vera Rubin chip architecture faces slight production delays due to thermal heat lid issues and HBM4 qualification delays with SK Hynix Inc ADR, KeyBanc foresees "minimal risk to estimates." To mitigate the delay, Nvidia is expected to ship more B300 GPUs in place of its R200 models. Vinh expects Nvidia to ship 5.5 million to 6 million Blackwell GPUs this year, along with 1 million Hopper GPUs. He also expects Nvidia to ship 70,000 to 80,000 total racks this year, including 5,000 to 6,000 Vera Rubin racks.

CoWoS Supply Supports AI Demand

The firm highlighted a significant increase in its supply forecast. Nvidia’s 2026 CoWoS supply outlook remains unchanged at 650,000 interposers, while 2027 supply has been revised significantly higher to 1.1 million interposers. This increase reflects strong demand and a full-year Rubin ramp. Vinh said Nvidia remains uniquely positioned to benefit from secular growth in data center AI and machine learning, pointing to Nvidia’s CUDA software stack as a major barrier to entry.

Nvidia Corporation shares gained 3.7% to close at $204.12 on Wednesday following reports that China has licensed ZTE Corporation and other firms to purchase Nvidia H200 chips. This development signals a potential easing of export restrictions, providing a significant boost to Nvidia's sales in the Chinese market. Chinese officials recently told Alibaba Group Holding Limited, ByteDance and DeepSeek that they may soon receive permission to purchase some Nvidia H200 chips, the Information reported on Wednesday, citing people familiar with the matter.

AI Trade Broadens Beyond Nvidia

The rebound follows a sharp valuation reset, with Nvidia losing roughly $1 trillion in market value since its May 14 record high, according to a Bloomberg report. The shares have fallen 16% as investors rotated into other semiconductor stocks, such as Micron Technology, Inc., leaving the stock trading at its cheapest valuation since before the artificial intelligence boom. Despite the multiple compression, Wall Street continues to raise earnings estimates, projecting 82% revenue growth and 90% profit growth in fiscal 2027. Bloomberg Intelligence data indicates Nvidia increased its server GPU market share to 97% at the end of 2025.

Technical Analysis

Nvidia is trading about 1.3% above its 20-day simple moving average of $201.69 but remains roughly 2.5% below its 50-day SMA of $209.52, suggesting the intermediate trend is still recovering. The stock trades about 3.6% above its 100-day SMA of $197.27 and 6.8% above its 200-day SMA of $191.40. The relative strength index stands at 50.60, indicating balanced momentum. Key resistance sits near $214, while support is around $199.50.

Earnings & Analyst Outlook

The next major catalyst arrives with the Aug. 26, 2026 earnings report.

Analysts maintain a Buy consensus rating with an average price forecast of $323.83. Recent analyst moves include China Renaissance initiating with a Buy (Target $319 on June 5), Needham maintaining a Buy (Target $270 on June 2), and DA Davidson maintaining a Buy (Target $300 on June 1).

Top ETF Exposure

Because Nvidia carries such a heavy weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.