Investing.com -- NVIDIA Corporation (NASDAQ: NASDAQ:NVDA) shares rose 3% as the tech sector continued its recovery, bolstered by capital expenditure announcements from Meta (NASDAQ:META) and Microsoft (NASDAQ:MSFT), and fresh reports indicating Nvidia’s ongoing efforts to adapt its chip designs for the Chinese market in the wake of U.S. export restrictions.
The company’s stock movement follows a report from The Information detailing Nvidia’s communication with major Chinese clients such as ByteDance, Alibaba (NYSE:BABA) Group, and Tencent Holdings (OTC:TCEHY). Nvidia is reportedly altering the design of its artificial intelligence chips to comply with U.S. export laws, as stated by sources familiar with the matter.
Nvidia’s CEO, Jensen Huang, informed customers of the company’s plans during a recent visit to Beijing, which occurred shortly after the U.S. government expanded its list of AI chips requiring approval for sale to China. This expansion included the H20, Nvidia’s most advanced AI chip previously permissible for export to China. This regulatory change has led to an anticipated $5.5 billion write-down for the quarter ending April, which initially prompted a decline in Nvidia’s stock price.
The strategic pivot to comply with export regulations and maintain its presence in the Chinese market appears to have reassured investors, contributing to the stock’s uplift.