Nvidia is now the largest bargaining of the US-China

Copyright © HT Digital Streams Limit all rights reserved. Dan Gallagher, The Wall Street Journal 2 min Read 16 Apr 2025, 08:17 IST Nvidia’s share price fell hard on Wednesday morning after the company told investors that the US government should now sell a license for the company to sell its H20 AI chips in China and a handful of other countries. (Photo: Reuters) Summary The ban on sales of the H20 discs questioned the company’s ability to constantly beat Wall Street’s high expectations. Nvidia’s position in the arithmetic of artificial intelligence is strong enough that even the lower slides of the business have a lot of demand. In the trade war, it doesn’t seem to be a good thing. Nvidia’s share price fell hard on Wednesday morning after the company told investors that the US government now needs a license to sell the H20 AI chips in China and a handful of other countries. The company said it would result in a cost of $ 5.5 billion in the current quarter, related to stock and purchase obligations for the chip. According to UBS Tim Arcuri, stock costs indicate about $ 13 billion to real H20 sales. In its financial year, Nvidia yielded $ 115.2 billion to data centers that ended in January-and, according to the Factset estimates, about $ 182 billion worth of sales for that segment. Although the H20 chip is not a large part of Nvidia’s sales, it will harm the company’s ability to constantly beat and increase Wall Street expectations -the way it has done at least the last three years. Investors are looking for an income of 56% for the current financial year; The company reports the results of the first quarter at the end of May. Nvidia designed the H20 chip to meet the existing US export controls that limit sales of advanced AI processors to Chinese clients. This means that the chip’s capabilities have been significantly broken down; Joe Moore, analyst of Morgan Stanley, estimates that the performance of the H20 is about 75% under that of Nvidia’s H100 family. It was the company’s top-of-the-line AI chip two years ago. But the inability to sell even a low-performance chip in the Chinese market shows how the trade war will scramble its business. Nvidia is now trapped between the world’s two superpowers as they take Jockey to take the lead in AI development. The fact is that the news about the effective ban came just a day after NVIDIA announced a plan to be clearly meant to the favor of President Trump, who forced US companies to move more manufacturing here. Nvidia CEO Jensen Huang even attended a dinner at Trump in Mar-a-Lago earlier this month, which spurred a media tap claiming that the White House has its plan to ban H20 sales in China. But an increasing trade war is not an excellent background for America’s Top Chip business to sell many of its goods in China. Half a trillion dollars are just going so far nowadays. Write to Dan Gallagher at Dan.gallagher@wsj.com, catch all the corporate news and updates on live currency. Download the Mint News app to get daily market updates and live business news. More Topics #semiconductors #Tariff Hike #Donald Trump Mint Special