Nvidia (NVDA) will take a big hit. $5.5 billion charge because its H20 AI chip needs an export license to sell to China. Nvidia stock dropped in premarket. Taiwan Semiconductor (TSM), AMD, and Broadcom (AVGO) also fell.
Nvidia said Tuesday night, the charge will happen in the April fiscal first quarter. It’s for “charges linked to H20 products for inventory, purchase promises, and reserves.”
On April 9, the Trump administration told Nvidia its H20 AI chip needs an export license to ship to China. The H20 was made for China to meet strict export rules under Biden.
It’s similar to the H100 Hopper chip but slower. Both are a step down from Nvidia's Blackwell chips.
If restrictions stay, Nvidia could lose over $10 billion in sales this year.
Nvidia stock dropped 6.8% in premarket. After rising from an 11-month low, it’s still below key levels.
Taiwan Semiconductor fell 3.6%. Broadcom dropped 4%, and AMD slid 7%. AMD might face up to $800 million in charges.
source: Inverstors.com
Note: The image is AI generated with help of chat gpt.