United States of America

Nvidia Shares Plunge as US Restricts AI Chip Sales to China

Published APR 18 2025

Story

Above: NVIDIA’s logo in Taipei, Taiwan, on April 16, 2025. Image credit: Daniel Ceng/Anadolu via Getty Images

The Facts

NVIDIA’s stock fell by 2.87% on Thursday—following losses of almost 7% on Wednesday—as the U.S. government announced new restrictions requiring licenses to export H20 AI chips to China, which could lead to a projected $5.5 billion financial hit for the company.
Yahoo! News
Sky News
In a regulatory filing Tuesday, NVIDIA disclosed that it was notified by the U.S. government's "indefinite" new restrictions on April 9, which are allegedly intended to mitigate against the risk that H20 chips “may be used in, or diverted to, a supercomputer in China.”
U.S. Securities and Exchange Commission
In a statement Wednesday, the company announced its intention to “follow the government’s directions to the letter,” declaring that shipments carrying H20 chips will be directed to markets other than China, naming the U.S. and Taiwan specifically.
X
This comes days after NVIDIA announced plans to build AI supercomputers in the U.S. for the first time, pledging to produce up to $500 billion in American AI infrastructure over the next four years in partnerships with organizations like TSMC, Foxconn, Wistron, Amkor, and SPIL.
NVIDIA Blog
Following the restrictions, NVIDIA’s CEO, Jensen Huang, visited Beijing at the invitation of the China Council for the Promotion of International Trade on Thursday, where he reportedly met DeepSeek founder Liang Wenfeng.
guardian
New York Post
The emergence of China's DeepSeek AI chatbot in January, which was developed using Nvidia's H20 chips at a fraction of the cost of American equivalents, reportedly contributed to increased pressure for tighter export controls.
ap

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The Spin

Pro-establishment narrative

If China wishes to compete with the U.S., let it, but it shouldn't use U.S. tools to do so. The administration's new restrictions, therefore, are essential to preventing China from using American-made AI chips in military applications and supercomputers that could threaten our national security, all while maintaining U.S. technological supremacy in the critical AI sector.

WSJ

Establishment-critical narrative

This abrupt policy change will surely backfire. Rather than holding China back, it will galvanize Chinese companies to fast-track the development of competing products, for which they will have a captive domestic market. The administration's actions ensure that a low-cost, Chinese competitor will emerge to challenge NVIDIA's, and thereby America's, chip manufacturing leadership.

The Telegraph