Nvidia will take a $5.5 billion charge as its H20 AI chip also now requires an export license to sell to China. Nvidia stock fell solidly in premarket trade, with Taiwan Semiconductor, Advanced Micro Devices and Broadcom also retreating.
The AI chip giant disclosed Tuesday night that it will take the charge in the April-ended fiscal first quarter for "charges associated with H20 products for inventory, purchase commitments, and related reserves."
The Trump administration on April 9 told Nvidia that the H20 will also require an export license to ship to China, the company said in a regulatory filing. The H20 is an AI chip specifically for the China market to comply with strict export controls developed under the Biden administration.
The H20 is similar to the H100 Hopper chip used in the U.S. and most other markets, but with slightly slower speeds. Both are a step down from Nvidia's new Blackwell chips.
If the restrictions continue, Nvidia could lose well more than $10 billion in sales for the year
Nvidia Stock
Nvidia stock fell 6.8% in premarket trade. Shares had rebounded from an 11-month low last week, but were still below key levels.
Taiwan Semiconductor stock declined 3.6%. Taiwan Semi, which makes chips for Nvidia, Broadcom and others, is set to report Q1 earnings early Thursday.
Broadcom stock slumped 4%.
AMD stock tumbled 7%. Advanced Micro Devices disclosed Wednesday that it could face up to $800 million in charges related to U.S. export curbs.
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