NVIDIA Corporation (NVDA) has received approval to sell its H20 artificial intelligence chips in China, following an agreement with the U.S. government. NVIDIA will pay 15% of total revenues from H20 sales in China to the U.S. government, a move aimed at re-entering one of the largest AI markets globally. The company previously estimated that tightened U.S. export restrictions would cost it $8 billion in lost sales in China for the second quarter of fiscal 2026.
The deal enables NVIDIA to circumvent prior restrictions that hindered its sales in the region. Access to the Chinese market is significant as demand from large tech companies and government projects is expected to bolster the sales of H20 chips. NVIDIA’s global revenue, which fell by 13% from fiscal 2023 to fiscal 2025, is projected to rise, with the Zacks Consensus Estimate indicating a year-over-year growth of 52.2% for fiscal 2026.
Shares of NVIDIA have increased approximately 36.4% year-to-date, outperforming the Zacks Computer and Technology sector, which has grown by 13% in the same period. Additionally, the current forward price-to-earnings ratio for NVDA stands at 36.66, above the sector average of 28.
