Nvidia Faces Setbacks as China Pushes Domestic AI Chips

Beijing's move to discourage Nvidia chip purchases boosts local competitors, impacting Nvidia's stock and market position.

Nvidia's stock has experienced volatility following Beijing's guidance for Chinese firms to prioritize domestic AI chips over Nvidia's H20 processors.
Chinese AI chipmakers like Cambricon Technologies and Huawei have seen significant stock gains, with Cambricon surging 20% in response to the news.
Nvidia's sales in China, which accounted for 14% of its data center revenue, are at risk due to increased local competition and geopolitical tensions.
Cerebras Systems Inc. has filed for an IPO, aiming to compete with Nvidia in the AI computing market with its CS-3 system.
The U.S. has imposed export restrictions on advanced AI chips to China, further complicating Nvidia's ability to maintain its market share in the region.