Nvidia (NVDA, Financials) expects a $5.5 billion charge in its upcoming earnings after the U.S. government imposed new export restrictions on its H20 AI chips sold to China. The company disclosed the charge in a filing Tuesday, ahead of its May 28 earnings report.
The H20 chip, which was designed to meet earlier export rules, will now require a special license for shipment to China. The U.S. Commerce Department said the move is aimed at protecting national and economic security. AMD's MI308 chips are also affected.
Shares of Nvidia fell 5% in early Wednesday trading. China accounted for 13% of Nvidia's revenue last year, and the licensing rule adds a new layer of uncertainty for the company's operations in the region.
The chip had been widely used by Chinese firms, including DeepSeek, whose R1 AI model surprised the tech world earlier this year for its capabilities and lower training costs.
The World Trade Organization warned Wednesday that trade tensions, including these export restrictions and broader tariffs, are weighing on global growth. It cut its GDP forecast by 0.6 percentage points and expects U.S. growth to slow even more.
Nvidia, which has spoken out against the policy, said the curbs risk stalling innovation and global economic progress. The company has urged regulators to consider the broader impact on U.S. competitiveness in AI technology.
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