Nvidia (NVDA) CEO Jensen Huang has scored a major victory in Washington, winning approval from President Donald Trump to sell advanced H200 chips to China. Huang’s argument that making China dependent on American hardware is strategically wise appears to have paid off. The deal also involves a new, high fee, as Trump said that “25% will be paid to the United States of America” on H200 sales to China.
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The President announced late Monday that the U.S. will allow Nvidia to ship its H200 products to “approved customers in China, and other Countries, under conditions that allow for continued strong National Security.” This is great news for investors after months of uncertainty about the chip giant’s revenue stream from the world’s second largest economy.
Nvidia CEO Conquers Washington, Next He Must Woo Beijing
Securing the White House’s backing is only the first part of the solution. Nvidia must still persuade China’s government to actually allow domestic companies to purchase its processors. Trump said Chinese leader Xi Jinping “responded positively” to the proposal, which involves more powerful AI chips than were previously permitted for export.
This victory confirms an important lesson. Securing a sure touch in Washington is a prized asset for corporations. The lobbying skills of the heads of Netflix (NFLX) and Paramount Skydance (PSKY) are about to be severely tested as they engage in a high-stakes bidding war for Warner Bros. Discovery (WBD). Convincing regulators about the competitive merits of their merger plans is just as important as winning over shareholders.
Hollywood Titans Face White House Scrutiny
The bidding war for Warner Bros. Discovery has quickly drawn the attention of the White House.
Netflix’s initial bid for Warner’s streaming and studios divisions was immediately challenged. Doubts about the deal emerged after President Trump warned that the acquisition “could be a problem” because it would give the streamer “a very big market share”.
Paramount dramatically raised the stakes with a hostile, all-cash offer worth $30 per share. The company claimed this offer was better for shareholders and more likely to be cleared by regulators. Paramount’s offer includes investments from sovereign-wealth funds, and President Trump’s son-in-law Jared Kushner is participating via his Affinity Partners fund. Trump later criticized Paramount after its news show 60 Minutes aired a negative interview.
Netflix may now have to make an even more lucrative offer to counter Paramount’s hostile bid. Warner has until December 22 to decide if Paramount’s offer is a superior option. This means that convincing Washington regulators about the merger’s merits is now just as important as winning over shareholders. If Netflix’s Ted Sarandos and Paramount’s David Ellison need tips on navigating D.C., they could learn a lot from Nvidia’s Jensen Huang.
Is Nvidia a Buy, Hold, or Sell?
Analyst sentiment toward Nvidia (NVDA) is rated as a Strong Buy, based on the consensus of 41 Wall Street analysts tracked in the last three months. Of these ratings, 39 analysts call it a Buy, one recommends a Hold, and one recommends a Sell.
The average 12-month NVDA price target sits at $258.00. This target implies an upside potential of 39.05% from the last price.
