Nvidia faces sales of $ 5.5 billion due to new constraints on H20 flea exports to China

Chipmaker Nvidia Corp. was struck by new American restrictions targeting the export of its H20 graphic processing units specializing to China. The change of policy, implemented this week, will cost the billions of dollars in the company because it makes a range of products designed to comply with the previously unnecessary anterior borders.

In regulations deposit Today, Nvidia said the White House informed that it should obtain a license to export H20 fleas to China for “the indefinite future”. According to CNBC, The new rules are intended to approach fears that products “can be used or diverted to a supercomputer in China”.

NVIDIA told shareholders that he expected to take an approximately $ 5.5 billion in charge during his first tax quarter due to “inventory, purchase commitments and related reserves” linked to his range of H20 products.

Society The stock dropped around 6% behind the report. Advanced Micro Devices Inc. Actions, which is the largest competitor in Nvidia on the IA flea market, has also decreased.

The disclosure indicates that Nvidia’s creeping growth in recent years could be slowed down due to the increase in export restrictions on its powerful processors, that American fears could be used by China and other nations hostile to military purposes.

The United States has been accelerating for years its restrictions on flea exports to China. The previous administration of President Joe Biden first placed constraints on which Nvidia products could sell to Chinese customers in 2022, and it Updated rules Again a year later, to try to prevent the sale of advanced processors. Nvidia responded by designing the H20 to comply with these export rules, and it generated around $ 12 billion at $ 15 billion in revenue for the company in 2024.

Nvidia’s H20 chip is comparable to H100 and H200 products It sells for American companies, but it has less bandwidth and slower interconnection speeds, based on an older architecture. However, officials of the Trump administration seem to have decided that even this scale chip is too powerful to be exported to its greatest rival in the artificial intelligence industry. It should be noted that Deepseek Ltd., the startup that developed a foundation model With reasoning capacities tied with the best models of Openai and other American companies, it did by using clusters of H20 flea.

The new rules suggest that the Trump administration intends to follow an approach similar to that of Biden in terms of trying to slow down the technological development of China and to follow previous sanctions placed on dozens of Chinese companies which, according to the White House, help the Beijing army.

During the Nvidia Last income call In February, CEO Jensen Huang said income from China had fallen at around half of the level of what it was before the first export controls were placed on its technologies. He also warned that competition from Chinese competitors increased. In the annual company file, he scored Huawei Technologies Co. Ltd. as a major competitor.

China remains the fourth largest Nvidia region in terms of sales, after the United States, Singapore and Taiwan, according to this file. During its 2024 financial year, which ended in January, more than half of its flea sales were devoted to American companies.

NVIDIA shares are now down by more than 16% of the year to date, with its previous decreases linked to Trump widespread on American trade partners. Although exemptions were placed on certain electronic products last week, including semiconductors, computers and smartphones, government officials said that the stay is only temporarySubject to separate tariffs specifically intended for technological products.

Photo: Nvidia