Nvidia (NVDA) disclosed a $5.5 billion quarterly charge as the U.S. plans to limit H20 A.I. chip exports over what it calls national security risks.
Nvidia stock (NASDAQ: NVDA) crashed on April 16, following the announcement of a H20 chip export ban aimed at China. Per initial estimates, this could cause a $5.5 billion writedown in the chipmaker's next quarterly report.
The US government's decision to restrict exports of Nvidia Corp's (NASDAQ:NVDA, ETR:NVD) H20 AI chip to China has drawn a swift and sharp market reaction - and analysts say investors should brace for more. Nvidia shares fell after the announcement, and fellow chipmaker AMD also came under pressure, as the Trump administration doubled down on efforts to limit China's access to advanced semiconductor technology.
Jim Cramer, the electrifying yet controversial host of Mad Money and former hedge fund manager, seems to have had a change of heart when it comes to Nvidia (NASDAQ: NVDA).
Nvidia (NVDA) said it expects to take a $5.5 billion charge in its fiscal 2026 first-quarter results after the U.S. limited exports of its artificial intelligence (AI) chips to China.
April 15 was a dynamic day for Nvidia (NASDAQ: NVDA). First, it received strong tailwinds thanks to President Donald Trump's endorsement of its artificial intelligence (AI) supercomputer plans for the U.S., then suffered an administration-induced crash in the extended session.
Nvidia on Tuesday notified regulators that it expects a $5.5 billion hit this quarter due to a new US licensing requirement on the primary chip it can legally sell in China.
Over the last few years, Nvidia (NVDA 1.30%) has emerged as the leader of America's tech industry -- riding a tidal wave of demand for its cutting-edge chips used to train and run AI algorithms. However, with shares down 17% year to date, the company has hit a roadblock as a combination of trade uncertainty and possible foreign competition calls its growth thesis into question.
Nvidia did not warn at least some major customers in advance about new U.S. export rules it was told about a week ago requiring it to obtain licenses to sell its China-focused artificial intelligence chip, according to two sources familiar with the matter.
Nvidia announced a $5.5 billion charge for H20 chip exports to China, causing shares to drop 6% in after-hours trading. Despite the setback, Nvidia's revenue growth remains robust, projected to grow over 56%, making it the leader in the AI chip space. The valuation remains fair, with Nvidia trading at less than 25 times fiscal 2026 expected earnings, and analysts maintain a very bullish outlook.
Nvidia said in a Tuesday SEC filing that it expects up to $5.5B in charges due to a new export rule. The rule targets Nvidia's H20 chips which were made to comply with Biden-era export controls.
The restrictions are the first major limits the Trump administration has put on semiconductor sales outside the United States, toughening rules created by the Biden administration.