Nvidia: The AI chip giant caught between US and China

Computer chip giant Nvidia has once again found itself at the centre of US-China tensions over trade and technology.

On Thursday Nvidia's chief executive Jensen Huang flew to Beijing to meet senior Chinese officials, just after the US imposed new export controls on its chips.

The California-based company will require licenses to export its H20 AI chip to China, a move which the US Commerce Department said was designed to safeguard "national and economic security". Nvidia said federal officials had told them the requirement will be in force for the "indefinite future".

But why is the company so pivotal in the race for AI supremacy between the US and China?

Nvidia designs advanced chips, or semiconductors, that are used in generative artificial intelligence. Generative AI can produce new content from a user's prompt, like ChatGPT.

In recent years, a surge in global demand for AI chips led Nvidia to become one of the world's most valuable companies. In November, Nvidia briefly unseated Apple as the largest company in the world by market capitalisation.

Because its chips are seen as so essential to advancements in generative AI, successive US administrations have scrutinised Nvidia's relationship with China.

Washington hopes the new export controls will slow China's development of advanced AI chips - especially their use by the Chinese military - and secure an advantage in AI competition with Beijing.

China is a critical market for Nvidia. The world's second-largest economy accounted for 13% of its total sales last year, though that is still far less than the United States, which accounted for nearly half.

The timing of Mr Huang's trip is being seen as an effort to shore up Nvidia's business in China despite the latest curbs.

In his Beijing meeting with Ren Hongbin, head of the China Council for the Promotion of International Trade, Jensen Huang said he hoped "to continue to cooperate with China", according to state broadcaster CCTV.

On Thursday, the Financial Times reported that Huang's trip to China also included a meeting with DeepSeek's founder, Liang Wenfeng.

Separately, top Chinese official He Lifeng told Huang that "China's market investment and consumption potential is huge", according to state news agency Xinhua.