Nvidia Faces $5.5B Hit as US Export Rules Shake AI Chip Market

Sammy Salmela
Apr 20
2 min read

Nvidia stock drops after $5.5B AI chip export restrictions

Article with AI Analysis

Date: April 16, 2025

Source: Cointelegraph

Introduction

Tensions between the US and China just sent shockwaves through the AI chip industry. Nvidia now expects a $5.5 billion charge after new export restrictions, sending its stock down 6% and rattling other chipmakers like AMD. The stakes are high not just for investors but for the global future of AI development.

US Export Rules Trigger Massive Nvidia Losses

In a new regulatory filing on April 15, Nvidia revealed a potential $5.5 billion charge due to tighter US restrictions on exports to China, Hong Kong, and Macau. These rules target its H20 chip the most advanced AI chip it can legally sell in China now requiring a licence to export.

The US government fears the chips might be diverted to Chinese supercomputers. This move impacts Nvidia's inventory, purchase commitments, and related reserves, sending immediate shockwaves through the market.

AMD and Nvidia Stocks Slide in Wake of Announcement

Following Nvidia's announcement, its shares fell by 6% to $105 in after-hours trading. Meanwhile, AMD suffered a 7% drop, closing at $88.55. Both companies have faced significant declines this year, with Nvidia down 22% and AMD over 25% year-to-date.

Despite Nvidia’s plans to manufacture some AI chips in the US investing hundreds of millions over four years investor sentiment remains fragile.

Geopolitical Risks Overshadow Tech Optimism

The broader narrative is clear: no tech company is immune to the effects of international politics. AI chips are now a strategic asset, and trade restrictions could dictate their future. Even recent goodwill meetings between former President Trump and Nvidia’s CEO haven’t stopped the tide of regulation.

AI-Powered Sentiment Analysis

Our AI analysis of this article revealed:

Sentiment Score: 0.57
Financial Sentiment: 2.52
Polarity Score: 0.085
Subjectivity Score: 0.486

These scores indicate a moderately positive tone, with a high level of financial relevance. Despite the short-term downturn, the overall message reflects strategic adaptation by Nvidia and signals to investors that long-term positioning may outweigh immediate losses.

Read the full article on: https://cointelegraph.com/news/chip-maker-stocks-slide-nvidia-faces-us-ai-chip-restrictions

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Disclaimer

This article was generated using AI and reviewed for accuracy. The information presented is for educational purposes only and should not be construed as financial advice. Always consult with a professional before making investment decisions.