TSMC stock jumps over 6% as Nvidia asks chipmaker to make memory chips

The US approved Nvidia's sale of H200 AI chips to New Matrix, a Chinese company with no apparent operations. The NYT found its office empty and no records of its existence. New Matrix's owners have ties to a US-blacklisted investment firm. Nvidia faced China sales restrictions under Biden, later eased under Trump.

The US has approved Nvidia's sales of AI chips to Chinese firms linked to blacklisted entities, according to reports. The approvals are for companies with no current use for the chips, raising questions about the policy's intent. Nvidia's H800 chip, a less powerful version of its AI chips, is among those approved for sale. The approvals come as the US seeks to limit China's access to advanced technology.

UBS estimates 30% of U.S. data-center capacity planned for 2028 may be at risk, impacting AI-related companies like NVIDIA (NVDA). NVIDIA's growth depends on new data centers, with Q2 2027 Data Center revenue at $89.023B, up 117% YoY. Shares fell 21.4% over the past month. Broadcom (AVGO) and others also cited supply constraints. Analysts debate NVIDIA's revenue estimates for 2028, ranging from $506.483B to $778.471B.

TSMC is considering expanding into advanced memory chip production, specifically 3D DRAM, to capture a larger share of the AI hardware market. The move follows a request from Nvidia, its largest customer, and could involve building new factories or acquiring an existing plant. The company has not confirmed plans or timelines. This potential expansion comes amid an AI-driven memory chip shortage that has increased prices and supply demand.

The US approved sales of Nvidia's H200 AI chips to Chinese firms, including some with ties to blacklisted entities, raising concerns about national security. Approved companies include Baidu, BYD, Tesla Shanghai, Alibaba, Tencent, and ByteDance. Nvidia defended its sales, stating China's military has little incentive to rely on US technology. The Commerce Department defended its screening process, citing penalties and enforcement efforts.

Memory chip makers like Micron, Sandisk, and SK hynix reported 80%+ margins due to AI-driven demand. TrendForce forecasts DRAM and NAND flash price increases. Apple's margins are pressured by memory costs, while Nvidia collaborates with TSMC for custom HBM.