Nvidia Stock Keeps Trading Sideways. Chinese Competition Has ‘Undeniably Arrived.’

Nvidia CEO Jensen Huang has campaigned for American chip makers to be able to sell their products in China. (Photo by I-HWA CHENG/AFP via Getty Images)

Nvidia was falling early on Thursday. Eyes are still on the prospect of the chip maker being able to resume sales in China.

Nvidia shares were flat in early trading. The stock fell 0.1% on Wednesday and appears to be largely moving sideways following a small drop after its recent earnings report.

CEO Jensen Huang told analysts alongside the earnings report that China represents a $50 billion market for AI infrastructure, growing at 50% a year. He said there was a “real possibility” Nvidia would be able to sell its more advanced Blackwell chips there in the future.

However, Nvidia has to overcome opposition from the Chinese government to the use of American hardware and the promotion of domestic alternatives. China’s Cambricon Technologies and Huawei are pushing to provide homemade options.

“The competition has undeniably arrived. Customers will choose the best technology stack for running the world’s most popular commercial applications and open-source models,” an Nvidia spokesperson said in an emailed statement to Barron’s. “We’ll continue to work to earn the trust and support of mainstream developers everywhere.”

Chinese companies, including Alibaba , are keen to be able to buy Nvidia’s prospective Blackwell chip for China’s market—called the B30A and set to cost around $22,000 each—if Washington and Beijing permit its sale, according to a Reuters report.

Alibaba didn’t immediately respond to a request for comment.

Among other chip makers, Advanced Micro Devices was down 1.4% and Broadcom was gaining 0.5% in morning trading.

Broadcom reports earnings on Thursday after the market closes. Investors will be watching to see if its custom AI chips are cutting into Nvidia’s dominant market share.

Write to Adam Clark at adam.clark@barrons.com