Nvidia’s China Breakthrough: A Key Market Reopens for AI Chips

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A significant barrier to Nvidia's business in one of the world's most crucial markets for artificial intelligence hardware appears to be lifting. Reports indicate Chinese regulators have granted preliminary approval for domestic tech giants to purchase Nvidia's high-performance H200 AI chips. This development provides a notable boost for the chipmaker, which had previously faced uncertainty due to stringent U.S. export controls.

According to industry reports, Chinese oversight bodies have given conditional approval for corporations, including Alibaba, Tencent, and ByteDance, to source Nvidia's H200 GPUs for their AI applications. This provisional green light allows these companies to begin concrete preparations for placing orders.

This move marks a contrast to earlier speculation that suggested a potential blockade of certain Nvidia chips in the market. The news was received positively in early trading, with Nvidia's shares reacting favorably. However, the arrangement may not be without conditions. Sources familiar with the negotiations suggest Beijing might encourage the involved tech firms to simultaneously purchase a certain quantity of domestically produced semiconductors. While this would represent a minor constraint for Nvidia, the fundamental outcome remains unchanged: access to the critical Chinese market is being preserved.

Lofty Expectations and a Strong Share Price

Nvidia's equity is currently trading near its record levels. At $185.47, the share price sits just over 2.5% below its 52-week high, following a gain of more than 100% over the past year. The substantial gap above its longer-term moving averages reflects the immense growth expectations priced into the stock, driven predominantly by its AI segment.

Upcoming Quarterly Results in Focus

Alongside the China development, investor attention is intensifying on the company's forthcoming financial report. Nvidia is scheduled to release its results for the fourth quarter of fiscal 2026 on February 25. The bar is set exceptionally high, consistent with the ongoing AI investment boom.

Current consensus estimates from market analysts project:

• Earnings Per Share (EPS): $1.52, representing an increase of approximately 71% year-over-year.
• Revenue: $65.47 billion, a surge of roughly 66.5% compared to the prior-year period.

These figures would confirm another quarter of extraordinary growth, fueled by relentless demand for computing power to train and run AI models in data centers globally.

Securing the Growth Trajectory

The potential breakthrough in China aligns with an already impressive growth narrative. Following a powerful performance in 2025, which saw the stock advance 38%, the core driver remains unchanged: soaring demand for Nvidia's specialized AI processors.

The scale of future demand is underscored by the company's reported order backlog: commitments for AI chips exceeding $500 billion for 2025 and 2026 highlight how aggressively customers are seeking to expand their computational capacity. The conditional approval for H200 sales in China acts as a supporting pillar, potentially securing and extending this growth pathway.

Forward-looking consensus estimates further illustrate the market's scale:

• Fiscal 2026: Revenue is projected to reach around $213 billion, an estimated 63% increase from the prior year.
• Fiscal 2027: Expectations point to $316 billion, representing growth of approximately 48% over 2026.

These projections reinforce the market's view of Nvidia as a central infrastructure provider in the global AI expansion. The latest development in China fits this narrative by keeping one of the world's largest technology markets at least partially accessible. The pivotal test will be whether the late-February earnings release confirms these lofty assumptions, thereby validating the current growth story.