What are U.S. export controls on AI chips?

U.S. export controls are government restrictions that limit the sale of advanced semiconductor technology, including AI chips, to certain countries like China. These restrictions are intended to prevent sensitive technology from being used in ways that might compromise national security. For companies like Nvidia, this means they cannot sell their most advanced chips to Chinese companies without special permission, which is why they've developed modified versions that comply with these regulations.

What makes Nvidia's modified chips for China different?

Nvidia's modified chips for the Chinese market are specially designed to comply with U.S. export restrictions while still offering strong AI performance. These chips have their processing capabilities intentionally limited to stay below certain thresholds set by U.S. regulations. While not as powerful as Nvidia's unrestricted chips, they still provide significant performance for AI applications, allowing Chinese companies to continue developing AI technology and giving Nvidia a way to maintain its presence in this important market.

How does a foundry like TSMC fit into the semiconductor supply chain?

A foundry like TSMC (Taiwan Semiconductor Manufacturing Company) is essentially a specialized factory that manufactures chips designed by other companies. Companies like Nvidia design advanced chips but don't own the facilities to produce them. Instead, they contract with foundries like TSMC that have the extremely expensive equipment and expertise needed to fabricate these complex semiconductors. This relationship makes TSMC a critical link in the supply chain—when Nvidia sells more chips to China, TSMC receives more manufacturing orders, potentially boosting its revenue.

What is high-bandwidth memory (HBM) and why is it important for AI?

High-bandwidth memory (HBM) is a type of computer memory designed for high-performance computing tasks, especially AI. Unlike regular memory, HBM stacks memory chips vertically (like a tiny skyscraper) and places them very close to the processor, allowing for much faster data transfer. This is crucial for AI applications because they process enormous amounts of data very quickly. Companies like Micron (MU) that produce HBM are essential to the AI ecosystem, as more powerful AI chips require more advanced memory solutions to reach their full potential.

What does "projected profit" mean in stock analysis?

Projected profit refers to how much money a company is expected to make in the future, typically over the next year or several years. These projections are calculated by financial analysts who study the company's business model, growth patterns, market conditions, and other factors. For investors, projected profit is an important indicator of a company's potential value growth. In the context of companies in this stock group, strong projected profits might suggest that a company is well-positioned to benefit from Nvidia's strategy in China and the broader AI industry expansion.

15 handpicked stocks

Nvidia's China Pivot: Resuming AI Chip Sales

This carefully selected group of stocks represents companies at the center of Nvidia's strategic move to sell compliant AI chips in China. Handpicked by our analysts, these investments span from Nvidia itself to its critical suppliers and Chinese tech companies that will gain access to these specialized GPUs.

Han Tan | Market Analyst

Published on July 15

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

NVIDIA Corporation

NVDA

Current price

$188.89

The central company designing and selling the new, compliant AI chips specifically for the Chinese market to navigate U.S. export restrictions.

Taiwan Semiconductor Manufacturing Co.

TSM

Current price

$288.11

As the primary foundry for Nvidia's advanced GPUs, increased sales of new chips to China will directly translate to higher manufacturing orders for TS...

As the primary foundry for Nvidia's advanced GPUs, increased sales of new chips to China will directly translate to higher manufacturing orders for TSMC.

ASML Holding NV

ASML

Current price

$1,030.17

This company's EUV lithography machines are essential for producing advanced semiconductors, and it benefits from foundries expanding capacity to meet...

This company's EUV lithography machines are essential for producing advanced semiconductors, and it benefits from foundries expanding capacity to meet demand from Nvidia.

Super Micro Computer, Inc.

SMCI

Current price

$52.50

Micron Technology Inc.

Current price

$183.75

GLOBALFOUNDRIES INC.

GFS

Current price

$35.74

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12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

≈

In 12 months it might be worth:

$1,000.00

+37.50%

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About This Group of Stocks

Our Expert Thinking

Nvidia's development of modified AI chips for China demonstrates remarkable adaptation to geopolitical challenges. This move allows the company to maintain its crucial Chinese market share while complying with U.S. export controls, creating valuable opportunities across the AI supply chain.

What You Need to Know

This stock group offers exposure to the entire semiconductor ecosystem affected by Nvidia's China strategy. It includes the core chip designer, critical foundries and equipment makers, memory suppliers, and Chinese tech companies that will leverage these specialized GPUs.

Why These Stocks

These companies were selected to provide tactical, event-driven exposure to a significant development in the global AI industry. Each represents a key link in the semiconductor value chain that stands to benefit from Nvidia's strategic pivot to maintain access to the Chinese market.

Group Performance Snapshot

37.5%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 37.5% over the next year.

13 of 15

Stocks Rated Buy by Analysts

13 of 15 assets in this group are rated Buy by professional analysts.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

🌐

Geopolitical Navigation Masters

These companies are showing remarkable ability to adapt to complex trade restrictions while maintaining growth. Their strategic flexibility could translate to stronger market positions as global tech tensions continue.

🧩

The Complete AI Supply Chain

This unique collection gives you exposure to the entire ecosystem around Nvidia's China strategy, from chip design to manufacturing to end users. It's the complete picture of a pivotal industry development.

🚀

China's AI Renaissance

With renewed access to specialized Nvidia chips, China's massive AI market is poised for accelerated development. These companies are positioned at the critical intersection of Western technology and Eastern implementation.

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