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Nvidia Faces $5.5 Billion Hit as U.S. Tightens Chip Export Controls to China

New restrictions imposed by the Trump administration on AI chip exports deepen U.S.-China trade tensions, triggering financial losses and market volatility for tech companies.

Overview

  • Nvidia disclosed a $5.5 billion charge tied to new U.S. export restrictions on its H20 AI chip, designed for the Chinese market.
  • Advanced Micro Devices (AMD) and ASML also reported significant financial impacts from the tightened export controls, with AMD taking an $800 million write-off.
  • The restrictions are part of expanded measures under the Trump administration aimed at curbing China's AI capabilities, escalating the trade conflict between the two nations.
  • Tech-heavy indices, including the Nasdaq, saw sharp declines as investor confidence eroded, with Nvidia's stock dropping nearly 7%.
  • Analysts warn the restrictions could reduce Nvidia's future revenues by 10% and exacerbate long-term risks to U.S. tech competitiveness.

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