Nvidia expects $5.5bn hit as US tightens chip export rules to China

NVIDIA, a microchip manufacturer, said that the US government has strengthened its export rules to China, with $ 5.5 billion (£ 4.2 billion).

The chip manufacturing giant at the center of the artificial intelligence (AI) boom requires a license to export the H20 AI chip to China.

This rule took place in the midst of an increase in trade war between the United States and China, and the two countries introduce steep trade tariffs dealing with various products.

NVIDIA stocks plummeted almost 6% from overtime transactions.

NVIDIA said on Tuesday that the US government called last week that the H20 chip demanded sales permit to China, including Hong Kong.

The technical giant said the federal officials advised that the license requirements would be “applied to the indefinite future.”

“that [government] NVIDIA pointed out that license requirements solve the risk of being used or shifted to China’s supercomputers.

The company rejected more opinions when contacting the BBC.

Marc Einstein of CounterPoint Research Consultancy said NVIDIA’s $ 5.5 billion popularity is consistent with his estimates.

“This is definitely a lot of money, but this is what NVIDIA can withstand,” he said.

“But as we have seen in the last few days and weeks, this can be mainly negotiated tactics. I will not only affect NVIDIA, but also not only affect the entire US semiconductor, but I will not be surprised to see some exemptions or changes in the tariff policy in the near future,” Einstein added.

The chip remains in the battlefield in the US-KHINA race for technology advantage.And US President Donald Trump wants to turbine a very complex and delicate manufacturing process that has been completely performed for decades for decades.

NVIDIA’s AI chip was the main focus of US export control. Founded in 1993, the product was originally known for creating a type of computer chip in the original graphics, especially computer games.

Before the AI ​​Revolution, I started adding a function to the chip. It is now considered a key company to see how quickly AI -based technology is spreading in the business world.

The company’s value was hit in January. When it was reported that the rival Chinese AI app, DEEPSEEK, was built as part of the cost of other chatbots.

At that time, the United States was considered to have been exposed by rivals.

NVIDIA said that $ 5.5 billion in claims will be related to the H20 products for inventory, purchase agreements and related protection areas.

The founder of Tech buzz china podcast, Rui MA, said that if the limit is maintained, the US and China AI semiconductor supply chains are expected to be “completely separated.”

She added: “It is meaningless for Chinese customers to rely on US chips,” he said.