By Adam Clark

Nvidia stock was rising early Thursday. The chip maker is continuing to feel the benefits of resumed access to the Chinese market although it could face a setback in selling artificial-intelligence processors in the Middle East.

Nvidia shares were up 1.1% at $173.17 in premarket trading. The stock rose 0.4% on Wednesday.

Continued demand for AI chips was underlined Thursday by Taiwan Semiconductor Manufacturing -- Nvidia's key supplier -- which reported a 61% jump in quarterly profit and raised its revenue outlook for the year. American depositary receipts of TSMC were gaining 4.4% in the premarket.

"TSMC's tone in AI is more positive than three months ago, and we think that reflects the recent sovereign demand and all [the] new gigawatt data center plans globally," wrote Jefferies equity sales specialist William Beavington.

That boom is only likely to get bigger with Nvidia's return to the Chinese market. CEO Jensen Huang held a media briefing in Beijing on Wednesday where he praised the country's technology development, the same week it was confirmed the Trump administration would allow Nvidia to resume selling H20 AI chips in China.

However, Nvidia could face one short-term disappointment -- an agreement to permit the United Arab Emirates to buy billions of dollars worth of AI chips is being held up by national-security concerns, The Wall Street Journal reported, citing people familiar with the matter.

President Donald Trump said in May the U.S. and the U.A.E. had agreed to create a path that would allow Abu Dhabi to buy advanced American AI chips. Middle Eastern countries such as the U.A.E. and Saudi Arabia are expected to be major buyers of Nvidia hardware to advance their own AI ambitions.

Among other chip makers, Advanced Micro Devices was up 0.8% and Broadcom was rising 0.6% in premarket trading.

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

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July 17, 2025 05:14 ET (09:14 GMT)

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