CNBC’s Jim Cramer said there is a path for Nvidia to reach $200 a share — more than 40% upside from Thursday morning’s levels, even when factoring in its post-earnings surge. “The next leg in Nvidia has to be sovereign AI, or China. If they get both, then the stock goes to $200,” Cramer said before the market opened on “Squawk on the Street.” Shares of Nvidia opened Thursday’s session at $142.25 a share, up around 5.5%. The advance extends Nvidia’s robust rally off its April 4 closing low of $94.31 a share, which coincided with Wall Street’s broader tariff-driven sell-off. The stock is less than 7% its all-time closing high set in January. Cramer’s Charitable Trust, the portfolio used by the Investing Club, has owned a stake in Nvidia well before the current artificial intelligence boom began in late 2022. Sovereign AI path Nvidia appears to be in good shape to check Cramer’s first box on sovereign AI, a term the company has coined to describe investments in AI infrastructure by countries outside the U.S. In recent weeks, Nvidia struck agreements with Saudi Arabia and the United Arab Emirates to sell large amounts of AI chips as part of large data center projects in those countries. Jensen Huang, co-founder and CEO of Nvidia, was traveling in the Middle East alongside President Donald Trump when those chip deals were announced. Trump’s decision to scrap a controversial Biden-era policy — known as the “AI diffusion rule,” which placed caps on AI chip exports to most countries around the world — made it possible for Nvidia to ink those deals with Saudi Arabia and the UAE. Now, Huang is set to travel to Europe in the coming days, and the executives’ comments on Wednesday night’s earnings call suggest that additional sovereign AI deals could soon be announced. While American tech giants such as Microsoft and Meta Platforms , also Club names, remain Nvidia’s most important customers, investors have wanted to see the chipmaker’s revenue streams diversify to help sustain topline growth. Sovereign AI deals help accomplish that. China hurdles One potential obstacle to checking Cramer’s second box on China: It would require another change in policy from the White House, which in April tightened restrictions on the kinds of artificial intelligence chips that Nvidia can sell to customers based in the world’s second-largest economy. Nvidia estimates that it will lose out on $8 billion in potential revenue from Chinese customers in its ongoing second quarter as a result of the tougher export controls. It also booked a $4.6 billion charge in its February-to-April period tied to the policy changes. On Wednesday’s earnings call, Huang was pointed in his criticism of the U.S. government’s restrictions, arguing the policy — first embraced by the Biden administration, then toughened under Trump — does not accomplish its stated goal of preventing China from developing advanced AI. Huang also offered a similar assessment in an interview with Cramer on “Mad Money” on Wednesday night. “Because there are so many developers there [in China] and because the world is going to adopt technology from one country or another — and we prefer it to be the American technology stack,” Huang told Cramer. Cramer said Thursday morning that he’s not sure how Trump will perceive Huang’s comments on the Chinese export controls, given the president just did away with the AI diffusion rule. “Do you really think you can come in right now and say, ‘What would be right is that you also give us China?’ I don’t know. That’s not ‘Art of the Deal,” Cramer said, referring to Trump’s famous 1987 book. One possibility would be Nvidia creating a modified, made-for-China version of its top-end AI chips that complies with Washington’s performance requirements. Huang said on the earnings call that Nvidia is “considering” whether to do that. “Obviously, the limits are quite stringent at the moment. And we have nothing to announce today. And when the time comes, we’ll engage the administration and discuss that,” Huang said.
