Nvidia (NVDA.US) H20 chip regains export license to China, Needham raised target price to $200

The Zhitong Finance App learned that Nvidia (NVDA.US) recently announced plans to resume sales of its H20 chips to the Chinese market, and said it has obtained a guarantee of an export license from the US government. Influenced by this news, the well-known investment company Needham raised the target price of Nvidia's stock from $160 to $200 and maintained a “buy” rating.

With N. A team of analysts led by Quinn Bolton pointed out that the H20 product embargo due to export controls in April of this year caused Nvidia to be unable to complete $2.5 billion in chip shipments in the first quarter of the 2026 fiscal year, and H20 orders worth nearly 8 billion US dollars originally scheduled to be delivered in the second quarter were also suspended.

Although Nvidia has yet to disclose specific revenue expectations for the H20 chip for the coming quarter, analysts have made conservative estimates based on market recovery expectations: starting from the third quarter of fiscal year 2026 (that is, October), the chip is expected to be shipped at a scale of 3 billion US dollars per quarter.

It is worth noting that Nvidia is developing Blackwell architecture GPU variants for the Chinese market (including models such as B30/B40/RTX 6000D), and shipments of related products are expected to begin between August and September. This policy adjustment and new product layout are seen as important strategic adjustments for Nvidia to meet the needs of the Chinese market.

The H20 is Nvidia's AI accelerator designed specifically for the Chinese market. It is based on the Hopper architecture and has 96GB of HBM3 memory and 4.0Tb/s of memory bandwidth. Its FP8 performance is 296 TFLOPS, and FP16 performance is 148 TFLOPS. Compared with the H100, the number of GPU cores is reduced by 41%, and the performance is reduced by 28%.

H20 is more suitable for vertical model training and inference. However, the upgrade of the US semiconductor export control policy to China has posed challenges to Nvidia's sales in the Chinese market.

The US Department of Commerce's Bureau of Industry and Security (BIS) issued two important new export control regulations for the Chinese semiconductor industry, further tightening restrictions on China's acquisition of advanced semiconductors and various terminal application products. The new regulations revised the Export Administration Regulations (EAR) and added FDP and FN5 FDP rules for semiconductor manufacturing equipment, limiting China's access to advanced semiconductor technology and products. In this context, the export of Nvidia H20 chips was blocked for a while, making it impossible to complete a large number of orders.

However, as Nvidia obtained an export license from the US government, the H20 chip was able to return to the Chinese market. This is certainly good news for Nvidia and helps ease its sales pressure in the Chinese market. As of press release, Nvidia US shares rose slightly in the premarket to $171. At the same time, Nvidia is also actively developing new products to meet the needs of the Chinese market. The launch of Blackwell architecture GPU variants will further enrich Nvidia's product line in the Chinese market.