Nvidia will be the ‘best beneficiary' of AI spending, says Morgan Stanley's Joseph Moore
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
an hour ago
- Yahoo
China cites ‘backdoor safety risk' in Nvidia's H20 AI chip; company denies allegation
Chinese authorities have summoned U.S. chip giant Nvidia Corp. over alleged security vulnerabilities in its H20 processor, a move that could complicate the company's efforts to re-enter the Chinese market just as Washington and Beijing struggle to make progress on a renewed trade truce. The Cyberspace Administration of China (CAC) called Nvidia representatives to a meeting to discuss 'serious security risks' tied to its H20 AI chip, Bloomberg reported, citing a statement from the internet watchdog. The agency pointed to comments from U.S. lawmakers advocating for tracking capabilities in advanced chips sold overseas, and asked Nvidia staff to explain potential vulnerabilities and provide supporting documentation. The probe casts a shadow over Nvidia's China business weeks after co-founder and CEO Jensen Huang visited Beijing and met with local AI firms and officials. While the company has denied any wrongdoing, saying its chips do not contain so-called 'backdoors', the timing of the investigation has raised eyebrows in the tech and policy communities. Security doubts cloud comeback 'The CAC's scrutiny over H20 security risks could further erode Nvidia's Chinese market share amid rising domestic competition, and immediate H20 sales resumption may face delays due to regulatory uncertainty,' Forrester analyst Charlie Dai told Bloomberg. 'It also aligns with China's broader push to accelerate domestic semiconductor alternatives for technological self-reliance amid U.S. export controls.' The H20 chip was designed specifically to comply with U.S. export restrictions on advanced semiconductors. Washington recently lifted some of those curbs, reportedly in return for increased access to Chinese rare earth minerals, just as trade talks in Stockholm aimed to extend a temporary tariff truce. While those negotiations were described as 'constructive,' no concrete resolution emerged. U.S. Commerce Secretary Howard Lutnick had framed the resumption of H20 sales as a breakthrough following earlier discussions in London, a claim that now appears increasingly uncertain. Domestic rivals gain ground The CAC's move also boosts local competitors. Huawei's Ascend 910C chip is now seen as a viable domestic alternative to the H20, particularly for inference workloads. According to Bloomberg, Huawei Technologies Co. now spearheads a nationwide effort to develop homegrown technologies to reduce China's reliance on American hardware and circuitry, and catch the U.S. in potentially game-changing technologies. Nvidia, meanwhile, reiterated in a statement that 'cybersecurity is critically important to us' and denied any claims of remote access or tracking features. 'Nvidia does not have 'backdoors' in our chips that would give anyone a remote way to access or control them,' the company said. As both countries tiptoe through fragile trade negotiations and navigate semiconductor nationalism, Nvidia's experience could signal deeper fault lines in tech diplomacy. While the H20 was initially hailed as a compromise chip to satisfy both regulators and customers, its future now hinges on a political equation that continues to shift. Solve the daily Crossword
NBC News
3 hours ago
- NBC News
CEOs globally brace for tariff turmoil with a new game plan
Trade tensions are rising, forcing top executives to rewrite the rulebook on how their companies operate, where they invest and what customers buy. In interviews with CNBC this earnings season, CEOs across industries — from aluminum and aerospace to chocolate, banking, telecoms, and energy — sent a clear message: tariffs are no longer just a political tactic. As trade rules grow more uncertain and tariffs resurface in policy discussions, business leaders say they're rethinking everything from where factories are located to how products are priced. The old 'just in time' model is giving way to something more cautious: make goods closer to the buyer, ask for exemptions where possible, and stay alert to shifting consumer habits. This earnings season has been marked by currency swings, inflation, and political uncertainty. And in that environment, tariffs are no longer background noise. They're front and center in how companies are managing risk. For many in the C-suite, the threat isn't just about short-term costs — it's about staying competitive for the long haul. Build local, think political 'We are concerned about the competitiveness of aluminum compared to other materials,' Hydro Chief Financial Officer Trond Olaf Christophersen told CNBC earlier this week. The company is already passing U.S. tariff costs onto customers. But the deeper worry is how, 'some customers in packaging are already testing steel and plastic alternatives. That's the long game we're watching.' For Christophersen, it's not just a quarterly issue — it's a warning sign. And Hydro's concern reflects a broader shift: tariffs are speeding up lasting changes in how companies do business. One of the most common responses is moving production closer to customers. Ericsson CEO Börje Ekholm told CNBC the company's North American factory, opened in 2020, was a forward-looking move. 'We've had that 'Made in America' stamp for some time,' he said. The facility now helps protect the company from shifting global politics. Volvo Cars CEO Håkan Samuelsson is also focused on the U.S. 'We want to fill our factory in South Carolina,' he told CNBC, noting that the company is breaking operations into more independent regions so local teams can respond quickly to new trade policies. Pharma giant AstraZeneca is also pivoting its footprint, rapidly shifting manufacturing to the U.S. and planning a $50 billion investment in local operations. 'We have lots of reasons to be here,' CEO Pascal Soriot said on the company's earnings call. For others, localization is as much about sovereignty as it is about logistics. 'We are building data centers for American hyperscalers in Europe, but also for Europeans in the U.S. It's a conscious decoupling,' Skanska CEO Anders Danielsson told CNBC. 'Sovereign tech is a real priority.' Not every company can shift where things are made. Some are relying on diplomacy. Rolls-Royce CFO Helen McCabe told CNBC the aerospace firm worked with U.K. and U.S. governments to win exemptions for key parts. 'It's not just about tariffs,' she said. 'It's about aligning our industrial footprint to minimize any friction.' That kind of behind-the-scenes outreach points to a bigger change: trade policy has become a key part of business planning. More companies are factoring in government relations and political risk when making decisions. Price hikes, policy risk and volatility Even the most proactive companies can't prepare for everything. Some are eating the higher costs. Others are raising prices — carefully. Lindt & Sprüngli, the premium chocolate maker, raised prices by 15.8% this year to offset soaring cocoa costs, driven partly by export restrictions in West Africa. 'We saw only a 4.6% decline in volume mix,' CEO Adalbert Lechner told CNBC. But he admitted that U.S. consumers are becoming more price-sensitive. Givaudan CEO Gilles Andrier shared a similar view. 'Some of our natural ingredients come from Africa and Latin America,' he told CNBC. 'So we're exposed to some tariffs there.' Even companies with local factories can't avoid all trade impacts when raw materials come from abroad. For companies tied to commodities, the trade duties are just one piece of a bigger puzzle: unpredictability. 'The tricky thing was, it was non-fundamentals-based volatility,' Shell CEO Wael Sawan told CNBC, describing recent swings in the oil market. 'This wasn't a change to physical commodity flows. This was really sort of paper-induced volatility.' That, he said, makes it harder to plan investments or manage price risk. Even in banking, where the direct impact of tariffs might seem small, the consequences are showing up. 'When you price risk now, you can't just look at credit or liquidity. You have to model policy unpredictability,' UniCredit CEO Andrea Orcel told CNBC. That includes trade tensions, regulatory surprises, and election-related gridlock. This quarter makes one thing clear: policy is now a core business risk, not background noise. With elections ahead and industrial policy shifting, companies are localizing, diversifying, lobbying, and repricing faster than ever. Tariffs aren't just a cost — they're reshaping industries. When customers trade aluminum for steel or chocolate for cheaper treats, the threat isn't just margins. It's market share. So yes, leaders are building closer to home, pricing smarter, negotiating harder as they scramble to stay ahead of the next curveball.
Business Insider
4 hours ago
- Business Insider
‘Don't Jump the Gun,' Says Investor About Nvidia Stock
Nvidia (NASDAQ:NVDA) stock has attracted plenty of positive coverage over the past few years – and for good reason. Behind the headlines is a company that consistently exceeds revenue expectations while maintaining strong profit margins, reinforcing investor confidence quarter after quarter. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Even regulatory roadblocks proved short-lived, as the Trump administration recently greenlit the company's ability to market its H20 chips to China, reversing a previous ban and effectively clearing a key overhang for investors. Meanwhile, broader concerns about a slowdown in AI infrastructure spending have also faded. The hyperscalers – those driving the AI boom – have now locked in their 2025 capex plans. Notably, Alphabet took things a step further, bumping its projection by a hefty $10 billion to a whopping $85 billion. That kind of spending speaks volumes about the demand tailwinds Nvidia still enjoys. With these tailwinds in place, it's tempting to see this as a no-brainer investment case. But not everyone is on board. One voice of caution is 5-star investor A.J. Button, who isn't quite ready to join the parade. 'Without being forced, I choose not to get involved in Nvidia stock,' Button says. The investor is not dismissing Nvidia's progress. In fact, he acknowledges the company could continue its explosive 50% CAGR pace, making its 2027 Forward P/E of 25x look downright reasonable. And yes, the macro setup – with rising capex and relaxed export rules – certainly supports continued growth. But Button is more focused on what lies ahead, zeroing in on a key concern: rising competition. AMD is gaining traction, Alphabet is building out in-house chips, and Huawei's offerings have been potent enough to force Nvidia to slash prices in China. Still, Button isn't outright bearish. He credits Nvidia's massive patent portfolio, entrenched software ecosystem, and the steep switching costs that act as barriers for would-be rivals. Yet, despite those competitive moats, Button remains cautious. 'The bottom line on Nvidia is that it has run up a lot, and is expensive by some metrics, but it's still not a short,' Button sums up, assigning NVDA a Hold (i.e. Neutral) rating. (To watch Button's track record, click here) Turning to Wall Street, however, the broader sentiment remains bullish. Of the 38 analysts tracked, 34 rate NVDA a Buy, translating to a Strong Buy consensus. The average price target stands at $185.79, suggesting ~7% from current levels. Not exactly something to write home about – yet history suggests that when it comes to NVDA, analyst targets often trend higher as momentum builds. (See NVDA stock forecast) To find good ideas for AI stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights.
