Nvidia said on Tuesday that the US government had blocked the sale of some of its artificial intelligence chips to China without a license and would start with a license for future sale.
The restrictions are the first important limits that the administration of President Trump has set abroad. It evokes the possibility that the sale of Nvidia to China will evaporate in the coming months, which puts an end to a company that has contracted if the United States has edited the export of Chip to its geopolitical rival.
Nvidia has fought hard to maintain sales to China in the light of rising US government restrictions. In 2022, the BIDEN administration laid down rules to curb the export of the best AI chips from Nvidia to China. NVIDIA responded by changing one of the leading AI chips, the H100, so that its capacities fell under the American government thresholds. The resulting H20 chip became a China-specific product.
NVIDIA will take a cost of $ 5.5 billion against its turnover in the current quarter because of H20 inventory, purchase obligations and related reserves that cannot sell or fulfill it in the aftermath of the new rule of the government, the company said.
The depreciation is a greater strategic blow than a financial. Nvidia, which dominates the market for semiconductors used in building artificial intelligence systems, considered selling chips to China that is vital for his future. If it were to get rid of the market, it feared that it would surrender the sale to the leading AI chip maker of China, Huawei, and that Huawei would start fighting for sale around the world.
“This kills Nvidia's access to an important market and they will lose grip in the country,” said Patrick Moorhead, a tech analyst at Moor Insights & Strategy. “Chinese companies are just switching to Huawei.”
Nvidia refused to comment. The company's share price fell on Tuesday more than 5 percent on the market after the hours.
A spokesperson for the Commerce Department, Benno Kass, said on Tuesday that the administration was granting new export lender requirements for the Nvidia H20; a chip of advanced micro devices, the MI308; And their equivalents.
“The Commerce department is committed to acting on the president's directive to protect our national and economic security,” said Mr. Kass.
NVIDIA unveiled the change in a regulatory application on Tuesday, a day after the company won the praise of the White House that he promised to invest $ 500 billion in AI infrastructure in the United States. The company had said that it would start to make servers in a factory in Houston and collaborated with chip packaging companies in Arizona.
But those promises were made after the Trump administration NVIDIA had been privately informed on Wednesday that it would begin to require a license to sell a license to AI chips to China, Nvidia said in his registration application. The company said on Tuesday that the Trump administration had followed that notification to say that the license requirements “will be in force for the indefinite future.”
The change also comes weeks after Jensen Huang, Chief Executive of Nvidia, met Mr. Trump during a dinner in Mar-A-Lago that cost $ 1 million per person. In the aftermath of that meeting there were reports that the US government would withdraw its plan to limit the sale of Nvidia to China.
In a letter sent to Mr Lutnick on Monday, Senator Elizabeth Warren, Democrat van Massachusetts, insisted on the Trump government to quickly act to limit the H20 and said Chinese technical giants such as Tencent, Alibaba and Bytedance to save the chips. They even took place when American startups and small companies in the United States could not acquire as many chips as they wanted, she said.
“The Commerce department cannot postpone taking the necessary and urgent action on the H20 to protect American national security,” she wrote.
Since Mr Trump took office, his administration promises to combat the American support of Chinese AI companies. The Chinese start-up Deepseek rattled Washington in recent months when it released a new AI system that said it was created for a small part of the costs that American companies had spent to train artificial intelligence.
During his nomination hearing, commercial secretary Howard Mr. Lutnick said that the United States should stop using Chinese companies American technology, including Nvidia's, “to compete with us”.
Last year Nvidia reported $ 17 billion in turnover to China. The company of the company has suffered a total percentage of its income in the light of the limitations of the US government. Sales to China, which was about one fifth of Nvidia's turnover in the financial year 2023, fell to 13 percent last year.
In his submission, Nvidia did not say whether the license requirements would influence future sale. Because it creates the H20 chip by nipping the performance of its H100 chips, it only has a limited inventory, analysts say. It can sell the H100 chips that have not been manipulated for American and European companies.
Ana Swanson Reported report from Washington.
