U.S.- China trade truce may lift 2 major chip stocks, Piper Sandler says

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U.S.- China trade truce may lift 2 major chip stocks, Piper Sandler says

The recent 90-day suspension of tariffs between the U.S. and China could translate into future gains for chipmakers Nvidia and Advanced Micro Devices , according to Piper Sandler. The agreement announced Monday puts China’s tariffs on U.S. goods at 10%, while the total U.S. tariff rate on ******** imports stands at 30%. Lower restrictions on exports of semiconductors may result from future trade talks between the U.S. and China, Piper analyst Harsh Kumar said. Treasury Secretary Scott Bessent told CNBC Monday that the U.S. is likely to meet with ******** officials ” in the next few weeks ” to potentially hammer out a wider trade agreement. “While this has not been specified just yet, we think as a measure of goodwill, the United States government is likely to allow companies such as Nvidia and AMD to sell chips within China that were previously banned,” the analyst wrote in a note published. “Again, this is not announced yet, but we think this is likely as trade negotiations solidify.” Kumar’s remarks came after the Commerce Department said last month that it imposed new export licensing requirements on sales of Nvidia and AMD chips to China. As a result, Nvidia said it would take a $5.5 billion charge tied to exports of H20 graphics processing units to China and elsewhere. “NVDA could also stand to benefit from a potential ability to sell the $5.5 billion of H20 product that was previously written off,” Kumar wrote in the note. “These chips may potentially and possibly be allowed to be sold in China in our view.” AMD similarly stands to benefit from removing the controls, with Kumar noting that it would be able to sell its Instinct product line, particularly to ******** buyers. Total sales for 2025 had been pegged at an estimated $1.5 billion, with $700 million coming in the current quarter and the rest spread over the second half of the year, Kumar noted. There have already been some signs of future progress. The Trump administration last week prepared to lift U.S. chip export restrictions under what was called the “AI diffusion rule,” first proposed under the Biden administration. Those plans had sent shares of both Nvidia and AMD higher. Along with the news of the latest trade progress, each have soared this month, with Nvidia surging nearly 19% so far in May, while AMD has gained more than 13%. Both are still down on the year, however. “We think with this deal the

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for the broader companies removes a key short-term overhang, thereby re-clarifying spend on chips,” Kumar also wrote. NVDA AMD mountain 2025-04-30 Nvidia and AMD shares in May

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