10:42 AM EDT, 07/15/2025 (MT Newswires) -- Nvidia ( NVDA ) will benefit from the loosening of US trade restrictions with China with higher sales and a longer duration of growth in the current cycle, Truist Securities said in a Tuesday note.

The company said late Monday that the US government assured it that licenses would be granted for the sale of its H2O graphics processing units in China, according to the note. Nvidia ( NVDA ) also said it introduced a new RTX PRO chip for smart factories and logistics that comply with the current export controls, the note said.

With these developments, Truist analysts said they expect an early increase in revenue of up to 20%, but in a limited duration as there are still ongoing capacity constraints.

The delayed fulfillment and constrained supply could mean an extension of the current growth cycle for the company's AI chips, which would be "especially positive" for the stock, the analysts said.

Nvidia ( NVDA ) previously took a $4.5 billion charge to write down H2O inventory and purchase commitments in Q1 after the trade restrictions were imposed, and the analysts said they expect initial sales of the H2O chips to sell at effectively 100% gross profit margin. When the written-down supplies are depleted, margins will normalize to, or potentially slightly exceed, the company's average figures, they said.

Truist rates the company's stock at buy, with a price target of $210.

Nvidia ( NVDA ) shares were 4.6% higher at $171.62 in recent trading.

Price: 172.02, Change: +7.95, Percent Change: +4.85