NVIDIA Stock Analysis: Chinese Companies Find Workaround to Access Blackwell Chips

Key Insights

• NVIDIA stock price rose slightly in the pre-market session on Friday.
• ByteDance, TikTok’s parent company, has found a way to access Blackwell chips.
• More Chinese companies may decide to use this approach to access its most advanced chips.

NVIDIA stock price rose by nearly 1% in the pre-market on Friday as market participants reacted to a new report on how Chinese companies are accessing its chips. It rose to $184, up from the year-to-date low of $170.

Chinese Companies are Finding Ways to Buy NVIDIA Chips

One of the top reasons why the NVDA stock price has remained in a narrow range this year is that Chinese companies have been barred from buying its chips.

However, there are signs that some of these companies are finding ways to buy these chips. For example, according to the Wall Street Journal (WSJ), ByteDance, the parent company of TikTok, is building a large data center in Malaysia in collaboration with a local company known as Aolani Cloud.

The report noted that Aolani will now deploy 500 Blackwell computing systems with 36,000 B200 chips in its large data center. These chips are estimated to be worth over $2.5 billion.

Other large Chinese companies may decide to use this approach, focusing on building data centers in countries where it is legal to access Blackwell chips.

Analysts believe that Chinese companies have a large appetite for NVIDIA chips, especially Blackwell, its most advanced one. In a report in January, Reuters noted that Chinese tech giants were preparing to buy over 700,000 H200 chips valued at over $56 billion.

Still, the main risk is that Washington officials are coming up with rules to regulate the export of NVIDIA chips. If these rules go through, international companies buying its chips will need to undergo a rigorous process, a move meant to prevent Chinese companies from accessing them.

On the positive side, President Donald Trump’s upcoming trip to China may address key semiconductor concerns and allow NVIDIA and AMD to sell their products there.

NVIDIA to Launch New Chips at the GTC Event

Meanwhile, NVIDIA will host the GPU Technology Conference (GTC) on Monday, where Jensen Huang will be the headline speaker. The most important part of this will be the potential launch of a new processor to help companies build faster and more efficient AI systems.

This launch comes as the company faces the threat of competition from other companies, especially its clients, which are all building ASIC chips. In addition to Microsoft, Google, and Amazon, Meta Platforms announced that it had launched its first ASIC chip this week.

The company may also unveil its rumored Central Processing Unit (CPU) in this event. Entering into the CPU industry will be a major milestone as it will help it to compete more directly with companies like AMD and Intel.

The new product launches will help the company sustain its growth, which has accelerated this year. Its recently released results showed that its revenue jumped to over $67 billion in the fourth quarter as the AI boom continued.

NVIDIA Stock Price Forecast

The daily chart shows that the NVDA stock price has been flat in the past few months. It has remained inside the key support and resistance levels at $170 and $197 since November last year.

By doing this, the stock has largely ignored the upbeat results released in November and February. Most recently, it reacted mildly to a report that a top billionaire was accumulating the stock.

The stock is oscillating at the 50-day and 100-day Exponential Moving Averages (EMA), while the Average True Range (ATR) has slumped to the lowest level since February. The ATR indicator is a common indicator that measures volatility in the market.

Therefore, the most likely NVIDIA stock forecast is neutral for now. It may remain in this range for a while and then stage a strong comeback as it has strong fundamentals, including its robust revenue and profitability growth. The initial target will be at $197, followed by the all-time high.

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