The global race for artificial intelligence supremacy is placing semiconductor leader Nvidia at a critical juncture. As worldwide demand for AI processors continues unabated, legislative efforts in Washington are introducing fresh complexities for the technology giant. Investors are now tasked with evaluating the tangible impact of a proposed 30-month export halt to China on the company’s long-term expansion trajectory.
Legislative Momentum for a Prolonged Ban
A significant bipartisan legislative proposal, dubbed the “SAFE Chips Act,” was introduced in the US Senate on Friday by lawmakers Pete Ricketts and Chris Coons. This bill seeks to codify existing export restrictions on advanced AI semiconductors into law for a period of two and a half years. Its core provision would mandate the US Commerce Department to deny licenses for shipping any chips that exceed specified performance thresholds.
The direct implication for Nvidia is substantial. Sales of its H200 chip and the forthcoming Blackwell architecture to the Chinese market would be effectively prohibited until mid-2028. The stated objective of this measure is to prevent future administrations from unilaterally relaxing such controls without securing congressional approval.
Fundamental Resilience Offsets Regulatory Headwinds
Despite these mounting regulatory challenges, Nvidia’s financial foundation appears robust. The company’s most recent quarterly results surpassed expectations, reporting revenue of $57 billion. Management has provided forward guidance projecting sales of $65 billion for the fourth quarter. CEO Jensen Huang has noted that cloud GPUs remain “sold out,” indicating that strong global demand is currently offsetting the loss of the high-end Chinese market.
This underlying strength was reflected in the stock’s relative stability during Friday’s trading session. After showing resilience intraday, shares closed with a modest decline of 0.53 percent at €156.66. Market observers attribute part of this steadiness to a separate legislative development.
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A Reprieve in Defense Legislation
A clause known as the “GAIN AI Act” was removed from the final version of the National Defense Authorization Act (NDAA). This provision would have compelled chip manufacturers to prioritize US customers over foreign buyers. Analysts had expressed concern that such a rule would severely disrupt the flexibility of global supply chains. Its omission from the final bill has been viewed as a positive development for the industry.
Intensifying Competitive Landscape
The urgency behind the US regulatory push is underscored by rapid advancements within China’s domestic semiconductor sector. The Shanghai IPO of GPU designer Moore Threads drew significant attention on Friday as its stock price skyrocketed by 425 percent. The firm is frequently described as a Chinese counterpart to Nvidia.
In a recent acknowledgment, Nvidia’s Jensen Huang stated that his company’s market share in China has effectively fallen to “zero” as a result of existing export controls. Concurrently, China’s chip manufacturing capacity is reportedly doubling each year. Rival AMD is also adopting a more aggressive posture, announcing that it holds licenses to ship certain accelerator chips to the Chinese market.
Investor Focus Shifts to Execution
Looking ahead, the investment community’s attention will center on the practical implementation of proposed legislation and Nvidia’s upcoming quarterly report in January 2026. From a technical analysis perspective, the stock currently trades below its 50-day moving average of €161.25, suggesting a near-term consolidation phase. The primary factor for future valuation will be the company’s efficacy in managing the strategic balance between adhering to US regulations and pursuing its worldwide growth ambitions.
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