China May Allow Tech Giants to Buy New Nvidia Artificial Intelligence Chips
Santa Clara, Monday, 28 September 2026.
China may permit companies like ByteDance to purchase Nvidia’s new RTX Pro 5500 chips, with ByteDance weighing a one-million-unit order to address severe domestic artificial intelligence hardware shortages.
Market Opening and Valuation Context
Nvidia Corporation (NVDA) shares are preparing for the Wall Street opening on Monday, 28 September 2026, following a critical week of evaluation regarding potential developments in China’s artificial intelligence market [1]. The stock closed at $225.07 on Friday, 25 September 2026, as investors weighed the implications of renewed market access against broader valuation metrics [1]. Market analysts are currently assessing whether the stock trades at a discount relative to its long-term growth trajectory, with some models suggesting intrinsic value remains meaningfully above current pricing [1]. The company maintains a price-to-earnings ratio of 28.2x, reflecting sustained demand across autonomous trucking, quantum computing, and AI data centers [1].
Investment Performance and Growth Models
Over the five-year period preceding September 2026, Nvidia has achieved a return of approximately 10x, establishing it as a defining stock of the AI buildout [1]. Valuation assessments utilize a 2-Stage Free Cash Flow to Equity model, which incorporates a trailing twelve-month Free Cash Flow figure of approximately $126.7 billion [1]. Despite this significant multi-year price appreciation, the Discounted Cash Flow model supports a higher valuation than the current market trading price [1]. Investors are advised to compare actual company progress against these established growth models rather than relying on static ratios [1].
Regulatory Shifts and Chip Specifications
China’s government is reviewing a plan to allow domestic tech giants, including ByteDance and Alibaba, to purchase Nvidia’s new RTX Pro 5500 chips [2]. The Ministry of Industry and Information Technology has directed major IT companies to report purchase plans, with indications that approvals may be granted to address severe domestic AI chip shortages [2]. The RTX Pro 5500 is designed for high-end professional computing but is being evaluated by Chinese firms for use in AI server clusters [3]. Pricing for the chip in China is reported between 85,000 to 90,000 yuan, approximately $12,528 per unit [2].
Revenue Potential and Market Share Dynamics
ByteDance is reportedly considering an order of approximately 1 million units, which could generate significant revenue if approved [2]. A potential order of this magnitude implies a transaction value calculated as 12.528 billion based on reported unit pricing [2]. Nvidia’s market share in China’s high-performance AI chip market previously plunged from 95% to 0% due to U.S. export controls, according to CEO Jensen Huang [3]. If purchase approval is confirmed, Nvidia could regain ground in China’s AI market for the first time in approximately one year [2].
Infrastructure Constraints and Strategic Outlook
Nvidia CEO Jensen Huang has emphasized that AI models are just the tip of the iceberg, requiring massive energy grids and scaled data center networks to function [4]. While the U.S. leads in frontier chips and models, China is moving rapidly at the base layers of energy and physical infrastructure [4]. This perspective suggests the bottleneck of the AI revolution may shift from software innovation to physical power generation and hardware execution [4]. Nvidia plans to ship approximately 500,000 units per quarter to China starting from late December 2026 [2].
Analyst Consensus and Order Deadlines
Customers have been notified to complete orders by 30 November 2026, though some reports suggest a deadline of 30 September 2026 to secure supply [2][3]. [alert! ‘conflicting deadline dates between sources’]. Nvidia maintains a Strong Buy consensus rating on TipRanks based on 31 unanimous Buy ratings [3]. The average price target stands at $324.32, indicating potential upside from the Friday closing price [3]. Market observers note that while OpenAI recently paused training on latest models, safety software and China access might offer relief to the sector [5].