Nvidia faces significant financial headwinds as the Trump administration’s latest export restrictions on China threaten to eliminate billions in revenue from the world’s second-largest economy. The chip giant, which previously generated 13% of its total revenue from Chinese markets, now confronts the reality of walking away from what CEO Jensen Huang estimates as $15 billion in potential sales following new curbs on its H20 AI chip.
The restrictions, implemented last month, specifically target Nvidia’s H20 processor—the only advanced AI chip the company was previously permitted to sell in China. This development has prompted the company to announce $5.5 billion in charges, while analysts project quarterly revenue losses ranging from $3 billion to $4.5 billion for the remainder of the year. The uncertainty has already impacted investor confidence, contributing to a 2% decline in Nvidia’s stock price this year, a stark contrast to the nearly 300% gains recorded in the previous year.
Despite these challenges, Nvidia is exploring new market opportunities as the Biden-era AI diffusion rule faces potential modifications under the Trump administration. The company has secured agreements to supply hundreds of thousands of AI chips to Saudi Arabia, including 18,000 of its latest Blackwell processors to a startup backed by the country’s sovereign wealth fund. However, analysts caution that revenue from Middle Eastern markets will likely remain minimal in the near term, unable to fully offset the substantial losses from the Chinese market restrictions.
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