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Nvidia Faces $5.5 Billion Charge as U.S. Export Controls Halt Chip Sales to China

New U.S. restrictions on advanced chip exports have effectively shut Nvidia out of the Chinese market, triggering a sharp industry-wide sell-off.

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U.S. Army Air Forces Staff Sgt. Frank J. Tedone was 23-year-old old when he reported missing in action on a bombing mission during World War II.
A McDonald’s logo is seen on a sign at the fast food restaurant’s location off the Danville exit of Interstate 80.

Overview

  • Nvidia announced a $5.5 billion quarterly charge following U.S. export restrictions on its H20 GPUs to China and other regions.
  • The U.S. government now requires licenses for exporting advanced chips, effectively cutting Nvidia off from the Chinese market, which previously accounted for over 13% of its sales.
  • The semiconductor sector experienced significant stock declines, with Nvidia shares dropping nearly 7% and AMD, ASML, and other major players also seeing sharp losses.
  • Analysts warn the restrictions could shift the global AI market, potentially giving Chinese competitors like Huawei a competitive edge.
  • The escalating U.S.-China trade tensions have introduced prolonged uncertainty for the tech industry, with revenue forecasts for major chipmakers being revised downward.