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Nvidia (NVDA) reports its first quarter results after the market close on Wednesday, May 28. Yahoo Finance Anchor Julie Hyman breaks down what China trade restrictions mean for the chip giant.
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Nvidia is reportedly planning to launch a new AI chip for China at a lower price than the H20 model as it looks to navigate US export curbs. This comes after the Trump administration restricted the shipment of Nvidia's H20 chips to China without a license, that happened in April, leading to an expected $5.5 billion quarterly charge from the company. Company's market share for AI chips in China has plummeted from 95% before export restrictions took effect to, in 2022, to 50% currently. That's of the AI chip market specifically, and that's according to CEO Jensen Huang. Still, China does remain a huge market for Nvidia, accounting for an estimated 13% of its sales in its fiscal year 2025. Earlier this month, Huang said that China's artificial intelligence market will likely reach about $50 billion in the next two to three years, and that missing out on it would be a, quote, tremendous loss.