Nvidia Faces Bipartisan Scrutiny Over Planned Shanghai Research Facility

Nvidia Faces Bipartisan Concern on China Research Facility Plans

Republican Senator Jim Banks and Democrat Elizabeth Warren are demanding answers from Nvidia Corp. CEO Jensen Huang on his firm's reported plans to open a research facility in Shanghai, saying the decision "raises significant national security and economic security concerns." Banks and Warren were reacting to a Financial Times report that Nvidia is opening a research and development center in the Chinese city. The news organization, citing people with knowledge of the matter, said the facility would be used for a potential expansion as well as existing employees and that the company is advertising to hire artificial intelligence talent in China.

Nvidia is cozying up to China, Senators say

Banks and Warren accuse chip maker of habitual 'disregard for US national security and support for autocratic regimes' Nvidia is reportedly planning to open a new research and development facility in Shanghai, China, drawing sharp criticism from a pair of US lawmakers. Senator Elizabeth Warren (D-MA) and Senator Jim Banks (R-IN) sent a letter [PDF] to Nvidia CEO Jensen Huang expressing concern that the planned facility could support China's access to advanced AI hardware and software, which are subject to US export controls. "No American company should be helping the Chinese Communist Party close the AI gap," Banks said in a statement. "NVIDIA was built by American innovation and taxpayer-funded research, not by empowering our adversaries." According to the letter, plans for the R&D facility are just the latest example of Nvidia cozying up to China, which the pair said "demonstrates a disregard for US national security and support for autocratic regimes." The letter argues that the reported plans, intended to better understand local customer needs, could expose Nvidia to pressure from the Chinese government to comply with "special conditions on foreign companies," posing serious risks to US national and economic security. A Nvidia spokesperson told The Register that, rather than being a new facility that would result in advanced chip designs ending up in Chinese hands, the biz is "simply leasing a new space for existing employees, who need the room in the post-Covid return to work." The scope of that work would remain unchanged, the spokesperson told us. This echoes what Huang said at the Computex conference in Taiwan last week, when he stated they were simply opening a new office because "we do not have enough chairs," adding, "if one person types, the other person has to stop." Warren and Banks are skeptical, claiming that Nvidia's core intellectual property "exists primarily as knowledge and digital designs" that would be easy to transfer to Chinese experts without physical evidence or an export license to do so. "[Nvidia] needs to answer questions about whether it is prioritizing its bottom line by chasing business in China at the expense of American leadership, security, and prosperity," Warren said. Jensen in the crosshairs The Nvidia CEO hasn't hidden his contempt for US export controls that have cost his company billions as it had to forgo planned shipments of H20 chips to China. While the GPU giant still posted record profits for the first quarter of its 2026 fiscal year, Nvidia predicted on Wednesday's earnings call that export control rules would cause it to miss out on $10.5 billion in previously anticipated revenue in the first half of its fiscal year. Huang talked up China during the call, describing it as one of the world's largest AI markets and "a springboard" to Nvidia's global success that was "effectively closed to the US industry." "Shielding Chinese chipmakers from US competition only strengthens them abroad and weakens America's position," Huang said on the earnings call. "The question is not whether China will have AI, it already does. The question is whether one of the world's largest AI markets will run on American platforms." It's a familiar tune for Huang. The Nvidia chief called US GPU export control rules "precisely wrong" and "a failure" at Computex last week - and that was after the Trump administration threw out so-called "diffusion" rules that would've restricted chip sales to a wide number of countries not on America's close-friends list. Huang has until June 20 to provide Warren and Banks with answers. ®

Unusual Senate duo presses Nvidia on plans for new Shanghai facility

An unusual Senate duo is pressing powerhouse chipmaker Nvidia on plans to open a research-and-development center in Shanghai, arguing the company is helping China's defense and technology capabilities. Sens. Jim Banks (R-Ind.) and Elizabeth Warren (D-Mass.) said that Nvidia's "recent decision raises significant national security and economic security issues that warrant serious review." "It is troubling that American firms are helping the PRC build cutting-edge semiconductor capacity, which will aid the country's defense-industrial complex and techno-authoritarian capacity," the pair wrote in a 4-page letter to Nvidia CEO Jensen Huang on Wednesday. The lawmakers are asking Nvidia what research and engineering activities will take place at the facility, which nodes and types of chips will be researched and how much money the chip manufacturer plans to spend on it. They also asked how many and what kinds of researchers will work at the facility. Huang said to reporters in late April that 50 percent of the world's artificial intelligence (AI) researchers are Chinese. "This is the industry that we will have to compete for," the executive said. "Given this leading position as an American company, NVIDIA has a responsibility to consider the significant national security implications of the use and misuse of its products," the senators told Huang. "This innovation should occur within the sphere of close democratic allies who share our values and commitment to responsible deployment of these emerging technologies." An Nvidia spokesperson told The Hill in an emailed statement that the company is "simply leasing a new space for existing employees, who need the room in the post-COVID return to work" and that the "scope of work will remain unchanged." The effort by the upper chamber lawmakers to press Nvidia marks an uncommon collaboration between Warren, a progressive stalwart, and Banks, a close President Trump ally and an "America First" conservative. The two also teamed up earlier this year, opening a bipartisan investigation into the role of private equity in the rising costs of fire trucks. Nvidia is in a delicate position, looking to preserve its ability to benefit from both Chinese and U.S. markets, along with adhering to new export controls imposed by the Trump administration. Huang said last week that the export controls are a disservice to the California-based company and that Nvidia has lost market share to its competition in China over the past four years. "The local companies are very talented and very determined, and the export controls give them the spirit, energy and the government support to accelerate their development," Huang said during an industry conference on May 21 in Taipei, according to The Wall Street Journal. Nvidia penned a deal earlier in May that would allow the United Arab Emirates to import half a million of the company's most advanced AI chips every year. Nvidia reported strong quarterly earnings this week, surpassing Wall Street's expectations in light of the export controls in place. The company's revenue went up from $26 billion in the first quarter of 2024 to $44 billion in the first quarter of 2025, jumping by 69 percent year-over-year. Its data center business revenue rose from $22.6 billion to $39.1 billion over the same timeline. Tighter export controls will end up costing NVIDIA $5.5 billion for exporting H20 chips to China. "NVIDIA's great financial and technology success was built on American innovation, American university research funded by taxpayers, and the capital, security, and freedom we provide -- not through collaboration with autocracies," the senators wrote in their letter.

Nvidia Faces Bipartisan Backlash Over Its Shanghai Facility Amid 'Significant' National And Economic Security Threat: Report - NVIDIA (NASDAQ:NVDA)

Nvidia Corporation NVDA is reportedly facing bipartisan criticism from U.S. senators over its plans to establish a facility in China, with concerns raised about the potential transfer of advanced technology to the country. What Happened: Senators Jim Banks (R-Ind.) and Elizabeth Warren (D-Mass.) have written to Nvidia's CEO Jensen Huang expressing their apprehensions about the company's Shanghai facility, reported The Wall Street Journal on Thursday. The senators have asked for a detailed timeline and overview of the facility's plans, including specific research and engineering initiatives, as well as any financial incentives involved. The facility "raises significant national security and economic security issues that warrant serious review," the Senators wrote in the letter. An Nvidia spokesperson stated that the company is only leasing a new space for its existing employees, with no plans to send advanced chip designs to the facility. The company is currently navigating the U.S.-China tech war and has been criticized by China hawks for its overseas activities. The company is trying to balance access to the world's two largest economies while adhering to export restrictions. Nvidia's overseas moves are under scrutiny due to fears that its artificial intelligence chips could fall into the hands of adversaries. SEE ALSO: China Tells US To 'Entirely' Revoke 'Wrongful Unilateral' Tariffs After Court Blocks Trump's 'Liberation Day' Levies - Benzinga Why It Matters: Earlier this month, reports emerged that Nvidia is considering a site in Shanghai for an R&D center. As per Reuters, U.S. chipmaker Nvidia began site scouting in early 2025, focusing on Shanghai's Minhang and Xuhui districts. The project accelerated following a surprise visit to China by CEO Jensen Huang last month. Nvidia's relationship with China has been a topic of discussion in the past. In May 2025, Nvidia CEO Jensen Huang criticized U.S. chip export curbs as counterproductive to America's technological leadership. He praised Chinese artificial intelligence researchers as "world-class". On Wednesday, Nvidia reported a strong first quarter, despite the China export ban impacting results. Huang stated that demand was 'incredibly strong.' This shows the importance of the Chinese market to Nvidia's business. Nvidia stock climbed 5.1% in the Thursday pre-market. Over the past year, it surged 17.4%, as per data from Benzinga Pro. READ MORE: Social Security Is The Main Source Of Income For Retirees In These 10 States: Is Your State On The List? - Benzinga Image via Shutterstock Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. NVDANVIDIA Corp$141.645.07%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentum74.09Growth98.75Quality94.27Value6.53Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs