The United States will reverse course and approve the sale of Nvidia’s H20 graphics processors in China for AI workloads. Nvidia incurred a $5.5 billion writeoff and missed out on revenue after the ban. The resumption of H20 sales could make Nvidia a dominant technology provider in China for AI.

Morningstar raises Nvidia’s fair value estimate to $170 per share from $140. The outlook for China and AI demand is positive but uncertain. Nvidia’s stock is now fairly valued with H20 revenue factored in, assuming increased revenue from China and higher gross margin assumptions.

The US reversal on AI policy with China may benefit Advanced Micro Devices as well. Instead of blocking US AI accelerator sales into China, Chinese firms may continue to rely on hardware, software, and networking from US companies like Nvidia and AMD.

Read more at Morningstar: Back in Business in China; Raising Fair Value Estimate