Nvidia and other AI stocks climbed Wednesday, extending Tuesday's gains as Saudi partnerships stoked excitement for future deals.

NVIDIA and the Saudi Data & AI Authority (SDAIA) will deploy up to 5,000 Blackwell GPUs for a sovereign AI factory and enable smart city solutions. NVIDIA and SDAIA will train government and university scientists and engineers on how to develop and deploy models for physical and agentic AI.

Nvidia stock jumped over 3% early Wednesday after the company and fellow chipmakers announced billions of dollars worth of AI deals with Saudi Arabia.

As Nvidia CEO Jensen Huang was in Saudi Arabia announcing the Blackwell deal, the Trump administration released a new round of AI chip restrictions targeting China. The Commerce Department issued a warning against the use of U.S. AI chips for Chinese models and singled out "diversion tactics" and securing supply chains to target smuggling.

The announcements follow reports that the US administration intends to facilitate AI chip deals between American firms and Gulf nations.

The next front in the AI arms race isn’t Beijing. It’s in Riyadh, at least according to Wedbush. A sweeping new partnership between Nvidia and Saudi Arabia’s sovereign AI initiative, Humain, was the focus of the gathering.

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In a geopolitical chess game with billions at stake, Saudi Arabia, the U.S. and Nvidia all have something to gain.