Nvidia Corporation (NVDA) is experiencing downward pressure in premarket trading after Chinese customs authorities instructed agents to prevent the company’s H200 AI chips from entering the country. This development comes just hours after the Trump administration granted conditional approval for these chip exports to China.
The timing creates a significant challenge for Nvidia’s China strategy, as the company faces potential loss of access to a market representing approximately $30 billion in orders. Chinese government officials also summoned domestic technology companies to meetings where they were explicitly instructed not to purchase the chips unless absolutely necessary, effectively creating a de facto ban on the processors.
China Blocks H200 Chips, Putting Nvidia’s China Revenue Back in Question
Chinese customs officials received orders this week to block Nvidia’s H200 artificial intelligence chips from entering the country, according to three sources briefed on the matter. The directive came with severe wording that essentially constitutes a ban for now, though authorities provided no formal explanation for the restrictions.
Beijing’s motives remain unclear, with analysts suggesting the move could be aimed at promoting domestic chip development or potentially serving as a bargaining tactic ahead of President Donald Trump’s planned April visit to Beijing.
The H200 chip, Nvidia’s second most powerful AI processor, delivers roughly six times the performance of the H20 chip that China restricted last year. Chinese technology giants including Alibaba, Tencent, and ByteDance had already placed orders for more than two million H200 chips priced at approximately $27,000 each, representing about $30 billion in potential revenue.
However, Nvidia only has around 700,000 chips in inventory, meaning supply constraints would have limited sales even without political interference. The situation is particularly challenging given that CEO Jensen Huang previously admitted Nvidia’s market share in China had dropped to zero following last year’s H20 restrictions.
NVDA Slips Premarket as Investors Weigh New China Risk
As of 7:58:52 AM EST on January 14, 2026, Nvidia stock was trading at $184.63 in premarket hours, down $1.18 or 0.64% from the previous close of $184.94. The stock had closed regular trading on January 13 at $185.81, up 0.47%, as investors initially processed the mixed signals from Washington and Beijing.
Despite the China uncertainty, Wall Street analysts maintain a Strong Buy consensus rating on the stock with an average price target of $252.81, implying potential upside of approximately 42.60% from current levels.
Nvidia’s market capitalization stands at $4.524 trillion with a trailing P/E ratio of 45.99 and forward P/E of 24.33. The company reported strong third quarter fiscal 2026 results with revenue of $57.01 billion and earnings of $31.77 billion, demonstrating continued strength in its core business despite geopolitical challenges.
The stock has delivered remarkable long-term returns, gaining 39.50% over the past year and an extraordinary 1,277% over five years. However, the Chinese restrictions introduce fresh uncertainty into the company’s growth trajectory, as re-entry into the Chinese market was expected to provide significant revenue opportunities following the U.S. approval of H200 exports under tight conditions including a 25% revenue-sharing arrangement with the U.S. government.