Nvidia's Challenge May Transform the Future of China Tech ETFs
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Aug 19 2025
0mins
Should l Buy BIDU?
Source: Benzinga
Nvidia's New AI Chip: Nvidia is set to launch a China-specific AI chip, the B30A processor, next month, despite facing a 15% revenue tax on its sales in China.
Regulatory Pushback: Chinese regulators have advised major tech firms like Alibaba and Tencent to halt procurement of Nvidia's H20 chip due to national security concerns, complicating Nvidia's market strategy in China.
Impact on Tech ETFs: The disruption in Nvidia's chip supply could negatively affect the growth prospects of China-focused tech ETFs, such as KWEB and CQQQ, which heavily invest in companies reliant on advanced GPUs for AI and cloud services.
Long-Term Market Shift: Beijing's emphasis on domestic self-sufficiency suggests a shift towards local alternatives like Huawei's GPUs, potentially transforming KWEB and CQQQ from consumer internet proxies to indicators of China's technological independence.
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Analyst Views on BIDU
Wall Street analysts forecast BIDU stock price to rise
13 Analyst Rating
11 Buy
2 Hold
0 Sell
Strong Buy
Current: 138.380
Low
100.00
Averages
160.67
High
215.00
Current: 138.380
Low
100.00
Averages
160.67
High
215.00
About BIDU
Baidu Inc is a Chinese language Internet search provider. The Company operates its businesses through two segments, Baidu Core segment and iQIYI segment. Baidu Core segment mainly provides search-based, feed-based, and other online marketing services, as well as products and services from the Company’s new artificial intelligence (AI) initiatives, such as display advertisement and based on performance criteria other than cost-per-click, cloud services, smart devices and services, non-marketing consumer-facing services such as membership, and intelligent driving. iQIYI segment produces, aggregates and distributes a wide variety of professionally produced content, as well as a broad spectrum of other video content, in a variety of formats, including a variety of products and services encompassing online video, online games, online literature, comics and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Apple Court Victory: Apple secured a courtroom win as a jury rejected claims from Optis Wireless that it infringed on 4G wireless patents, a result that will help protect Apple's intellectual property and strengthen its market position.
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- Warning Against Cutthroat Competition: The regulator urged companies to eliminate 'involution-style competition,' which refers to cutthroat rivalry, and called for collaboration to maintain a healthy market environment, promoting sustainable development and industry stability.
- Participating Companies: Other firms such as ByteDance's Douyin, Tencent, Meituan, and Taobao also took part in the discussions, highlighting the regulator's focus on the entire industry and the importance of compliance.
- Impact on Market Environment: This regulatory action may have profound implications for internet companies' operational models, prompting them to prioritize compliance and cooperation in their competitive strategies, thereby influencing the future market landscape.
See More
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- Escalating US-China Tensions: The addition of Alibaba and BYD to the 'Chinese Military Companies' list is likely to escalate trade tensions ahead of the Trump-Xi summit, potentially impacting future economic cooperation and policy directions between the two nations.
- Reputational Risks: While being placed on the list does not carry immediate legal consequences, it poses reputational risks for the companies, which could lead to future punitive measures from the US, affecting investor confidence and market performance.
- National Security Concerns: US intelligence agencies expressed concerns about Alibaba's potential national security threat, leading to its designation three months ago, reflecting increased scrutiny on Chinese tech firms that may impact their international operations.
- BYD's Legal Battle: BYD's advancements in battery technology have solidified its position in the EV market, while the company has filed a lawsuit against the Trump administration over 100% tariffs on Chinese electric vehicles, demonstrating its resistance in a challenging policy environment.
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- Legal Investigation Initiated: The Law Offices of Howard G. Smith are investigating potential violations of federal securities laws on behalf of Baidu investors, aiming to provide legal support and avenues for claims to recover losses.
- Market Reaction Intensified: On February 13, 2026, Baidu was again listed as aiding the Chinese military by the Pentagon, which was quickly retracted, causing the stock to drop nearly 5% during intraday trading, further exacerbating investor losses.
- Investor Rights Protection: The law firm is urging all investors who purchased Baidu securities during this period to contact them to explore potential claims, ensuring that investors' legal rights are upheld.
See More
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- Stock Price Impact: On November 26, 2025, Baidu's stock fell by 1.3% to close at $116.34 after the Pentagon identified it as one of the companies aiding the Chinese military, resulting in investor losses.
- List Addition Incident: On February 13, 2026, the Pentagon added Baidu to the list of companies aiding the Chinese military but quickly withdrew it, causing the stock to drop nearly 5% during intraday trading, further harming investors.
- Legal Consultation Opportunity: The Law Offices of Howard G. Smith are investigating on behalf of Baidu investors, urging those who suffered losses to contact them for potential claims, highlighting the significance of legal action.
- Investor Rights Protection: This situation underscores the importance of investors seeking legal advice and protecting their rights in the face of potential corporate legal issues, especially during stock price volatility.
See More
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- Asset Management Shift: Following this liquidation, Baidu now represents 0% of Infini's reportable AUM, with the fund reallocating its investments primarily to VNET and CHA, highlighting a major portfolio restructuring.
- Financial Impact: The quarter-end value of Baidu decreased by $4.4 million, illustrating that Infini failed to capitalize on Baidu's 48.3% stock price increase over the past year, reflecting broader market challenges.
- Market Sentiment: Infini's decision to exit follows an 18% drop in advertising revenue and a $2.2 billion impairment charge in Q3 2025, suggesting growing frustration with Baidu's stock performance, leading to a gradual sell-off throughout 2025.
See More
