Nvidia may be the most valuable company on the planet, but its biggest risk may come not from rivals in Silicon Valley or Beijing, but from Washington.
The US chip giant, which recently became the first firm to cross a $4tn market valuation, is at the forefront of artificial intelligence and continues to dominate the market for advanced processors. Yet Donald Trump’s White House has increasingly inserted itself into the company’s affairs — and investors are beginning to worry.
A deal shaped in Washington
Last week, Nvidia confirmed a $5bn investment in Intel, a struggling US rival that has been losing ground for years. The timing raised eyebrows. Only weeks earlier, the US government had taken a 10% stake in Intel, fuelling speculation that Nvidia had been pushed into shoring up the once-dominant chipmaker.
The market reaction was telling: Intel’s stock jumped more than 20% on the news. But analysts warn Nvidia risks being dragged into a turnaround project that could divert attention from its own core growth areas.
“It makes little commercial sense,” one Wall Street analyst said. “Intel has lost market share and technological leadership. Nvidia should be focused on AI, not propping up competitors.”
A 15% ‘cut’ on China sales
Trump’s administration has also forced Nvidia to hand over 15% of revenues from certain chip sales to China in return for export licences. The White House framed it as a national security safeguard, but critics say it looks more like a revenue grab.
“If selling to China is a security risk, block it. If it isn’t, let Nvidia sell. Skimming 15% doesn’t solve either problem,” said one US tech industry executive.
Pushing factories into Texas and Arizona
Another area of political pressure is manufacturing. Nvidia has committed to building chip plants in Texas and Arizona, moving production from Taiwan, the centre of the global semiconductor industry. While the policy fits with Trump’s push for “Made in America” manufacturing, critics question the logic.
“Taiwan already has the expertise. Replicating that in the US will take years and cost more,” said Professor Alan Woodward, a technology policy expert. “It risks higher costs, lower quality and slower innovation.”
From gaming chips to AI dominance
Nvidia’s rise has been extraordinary. Once best known for powering video games, its processors now underpin the boom in artificial intelligence. Chatbots, data centres and autonomous systems all run on Nvidia chips, giving the firm a technological edge that rivals find difficult to close.
Its success has fuelled huge gains for investors and cemented US dominance in the global AI race. In many ways, Nvidia has become to AI what Intel once was to the PC era.
History of government restraint
The contrast with past administrations is striking. Apple, Amazon and Google were allowed to grow with minimal interference from Washington. George W Bush did not push Steve Jobs to rescue Motorola. Barack Obama did not tell Jeff Bezos to invest in bookshops or Google to relocate production lines.
By leaving them to flourish, those firms became global leaders. Trump, by contrast, appears intent on directing Nvidia’s strategy from the Oval Office.
The real risk
Nvidia’s growth story is far from over, but competition from Chinese manufacturers and other US rivals is intensifying. Investors already face uncertainty over whether its meteoric run can continue.
Yet, paradoxically, its biggest obstacle may come from the very government that should be celebrating it as an American success story. For now, Nvidia remains the world’s most valuable company. But if political interference continues, that crown may prove hard to keep.
