Chinese Chip Stocks Decline on Report Beijing May Approve Nvidia GPU Sales

Chinese chipmaking stocks fell on Monday following a report that Beijing is considering allowing domestic technology companies to purchase certain advanced chips from Nvidia Corp., a move that could intensify competition for China's homegrown semiconductor industry.

Report Signals Policy Shift

According to a report by *The Information*, China’s Ministry of Industry and Information Technology has surveyed major domestic firms, including Alibaba and ByteDance, about their potential procurement plans for Nvidia's RTX Pro 5500 professional workstation GPUs. The inquiry is being interpreted by market participants as a signal that Beijing may ultimately approve sales of the chip, the report stated.

The RTX Pro 5500 is a powerful Blackwell-generation processor capable of handling demanding AI computing tasks. However, it falls outside the specific category of high-end AI accelerators that the U.S. government has restricted from being sold to China.

Domestic Chipmakers Under Pressure

The prospect of renewed access to advanced foreign technology sent a chill through the domestic chip sector, which underperformed the broader Chinese and Hong Kong markets. The sell-off hit several key players in China's semiconductor ecosystem:

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• Semiconductor Manufacturing International Corp (SMIC), China's largest contract chipmaker, dropped 3.7%.
• Moore Threads Technology Co Ltd, often seen as a domestic rival to Nvidia, saw its shares slide 6.3%.
• Cambricon Technologies Corp Ltd fell 5.7%.
• Memory chip specialist CXMT Corp declined nearly 4%.

Context for Investors

This development introduces a significant headwind for Chinese chipmakers, which have been central to Beijing's push for technological self-sufficiency amid U.S. export controls. The potential approval of Nvidia chip sales suggests that for now, access to foreign technology may be prioritized for major tech firms, even if it comes at the expense of nurturing domestic alternatives.

The news comes after a recent U.S.-China summit where officials agreed to improve trade relations, though the topic of AI chip sales was reportedly not discussed. China's homegrown chip manufacturing processes are still widely considered to be several years behind the leading-edge technology produced in the U.S. and Taiwan.