Global chip stocks, including Nvidia and AMD, drop due to U.S. export restrictions for China
From Yahoo Finance: 2025-04-16 07:05:00
Global chip stocks, including Nvidia and AMD, tumbled due to U.S. export restrictions on AI processors for China, causing Nvidia to warn of a $5.5 billion hit and AMD an $800 million loss. Nvidia shares fell 7%, losing $148 billion in market value, while other AI-related chip stocks also dropped.
Nvidia follows U.S. government directives on chip sales, emphasizing support for American exports worldwide. Tightening U.S. export curbs on Chinese markets affect American chipmakers. Uncertainty in the tech and semiconductor sectors under Trump-era policies lead to selloffs in chip stocks.
Nvidia drew 13% of sales, $17 billion, from China last year, down from 21% in fiscal 2023. AMD’s China revenue accounted for over 24% of total sales. The ban on Nvidia’s H20 chips may hand the Chinese AI market to Huawei, impacting earnings but not drastically.
Trump’s latest exemptions on semiconductor tariffs spared some electronics but threatened sector-specific levies soon. Potential tariffs could cost U.S. semiconductor equipment makers over $1 billion annually. Nvidia’s recent selloff due to export curb news affected chip companies worldwide, including suppliers in South Korea, Europe, and Japan.
Despite the export curb fallout, Nvidia’s overall sales remain strong, especially to core hyperscale customers. Chip demand from big cloud companies sustains growth, offsetting China’s contribution decline. Nvidia’s plan to build AI servers in the U.S. aligns with Trump’s policies, aiming to appease the administration and avoid further restrictions.
Read more: Global chipmakers feel the pinch of Trump’s shifting trade policy