nvidia's uae ai chip deal faces us roadblock over china risk

2025-07-18 nvidia

Washington, Friday, 18 July 2025.
A deal for 500,000 nvidia ai chips to the uae’s g42 is in limbo. Us officials fear china could access the advanced technology. This deal, supported by trump, is now under scrutiny. Some want to block g42’s direct access, raising questions about us-uae ai collaboration. Nvidia’s stock could be impacted by this potential market restriction. Adding intrigue, g42 is run by the uae’s national security advisor, and huawei has approached the uae about buying ai chips.

national security concerns stall chip deal

U.S. officials are delaying a deal to sell Nvidia AI chips to the UAE over concerns that China could gain access to the technology [1]. The deal involves approximately 500,000 of Nvidia’s advanced AI chips destined for G42, a UAE-based company [1]. Some officials are pushing for new terms to restrict G42’s direct access to the chips [1]. This situation casts doubt on future AI tech collaboration between the U.S. and the UAE, potentially affecting Nvidia’s market reach and revenue from AI chip sales [1].

g42’s role and huawei’s interest

G42, the AI firm slated to receive 100,000 of the 500,000 chips, is state-owned and managed by the UAE’s National Security Advisor, Sheikh Tahnoon bin Zayed al-Nahyan [1]. This connection adds complexity to the deal [1]. Huawei, seeking AI chips, has approached both Saudi Arabia and the UAE, increasing concerns about technology transfer [1]. The U.S. is reportedly suspicious of the UAE’s ability to protect American technology [1]. These factors contribute to the ongoing delays and renegotiations surrounding the Nvidia chip deal [1].

nvidia’s h100 chips at stake

The UAE is interested in Nvidia’s H100 chips, estimated to cost $25,000 each [1]. A sale of 500,000 chips would substantially benefit Nvidia [1]. The delay impacts Nvidia’s potential revenue stream and market position [1]. Nvidia CEO Jensen Huang emphasized the deal’s importance to Trump in a recent meeting [2]. Trump had previously lifted the ban on Nvidia selling H20 AI chips in China [1]. This move and the UAE deal highlight the complexities of Nvidia’s global market strategy [1].

white house divided on the deal

White House AI czar David Sacks supports pushing the Nvidia chip sales through [1]. Sacks argues that restricting access to U.S. technology would push countries towards Chinese alternatives [3]. He downplays concerns about potential chip diversion [3]. Sacks stated, “If we don’t provide this technology, our global competitors will” [7]. He also added, “The concerns about the chips being diverted are being greatly exaggerated” [7]. The internal disagreement within the U.S. government adds another layer of uncertainty to the situation [3].

industry impact and competitive landscape

The delayed Nvidia-UAE deal underscores the growing tension between technological advancement and national security [6]. China’s Foreign Ministry has criticized the U.S. for politicizing trade and tech issues [6]. The U.S. Commerce Department might not approve any chips going directly to G42 [1]. This restriction could hinder the UAE’s AI development plans, as G42’s participation is central to the agreement [5]. The situation highlights the challenges Nvidia faces in navigating geopolitical concerns while maintaining its competitive edge [3].

potential financial implications for nvidia

The uncertainty surrounding the UAE deal could negatively affect investor sentiment towards Nvidia [1]. A cancelled or significantly altered agreement would limit Nvidia’s revenue potential from AI chip sales [1]. Missing out on the sale of 500,000 H100 chips, each valued at $25,000, represents a substantial financial loss [1]. 12.500 billion equals $12.5 billion [alert! ‘calculation based on estimated H100 price’] in potential revenue at stake [1]. This situation could impact Nvidia’s stock performance and future growth projections [1].

Bronnen

nvidia ai chips us-uae relations