Nvidia Breaks Wall Street Records – Then Shocks Market With US–China Chip Deal
Nvidia has made history by taking up almost 8% of the S&P 500 index. This is the highest share any single company has held since records began in 1981.
Only Apple came close in 2023 with just over 7%. Even during the 2000 Dot-Com Boom, tech giants like Microsoft and General Electric each reached only about 4%. IBM’s biggest share was around 6% back in 1984.
This record means the S&P 500 is now heavily influenced by Nvidia’s stock price. Any big moves in Nvidia could have a major effect on the entire US stock market.
Nvidia & AMD’s Unusual Deal with the US Government
In a surprising move, Nvidia and AMD have agreed to give 15% of their chip sales revenue from China to the US government. This was a condition to get export licenses for selling advanced AI chips in China.
For every $1 million in chip sales in China, the US government will get $150,000 from each company. This is the first time such a direct revenue-sharing deal has been made between Washington and private tech companies.
China is a Huge Market
In 2024, Nvidia earned about $17 billion from China, roughly 13% of its total sales. AMD made $6.2 billion, about 24% of its revenue. These figures show just how important China is for both chipmakers.
Impact:
* The deal could strengthen the US dollar as the government gains a new income stream from foreign tech sales.
* Currencies like the Chinese yuan, Australian dollar, and other Asia-Pacific currencies may face pressure if chip trade slows or costs rise.
