Equity and cryptocurrency markets faced significant declines late Tuesday following Nvidia’s announcement of a projected $5.5 billion charge impacting its next earnings report. This financial setback is attributed to new U.S. export restrictions on artificial intelligence chips destined for China.
The news also triggered a steep drop in the stock prices of both Nvidia and its competitor, AMD, during after-hours trading.
In a regulatory submission dated April 15, Nvidia disclosed that the U.S. government had informed the company on April 9 about the requirement for new export licenses for its high-bandwidth AI chips, including the widely utilized H20 model.
These new export rules specifically target shipments to China, Hong Kong, and Macau, citing national security issues and the risk that these chips could be integrated into Chinese supercomputers.
Nvidia Predicts Q1 Charges Linked to H20 Chip Inventory and Obligations
Nvidia indicated that the charges for the fiscal first quarter, which closes on April 27, will encompass inventory write-downs, purchase obligations, and reserves associated with the H20 chip.
The H20 is recognized as Nvidia’s most powerful AI chip previously permitted for export to China under earlier regulations.
Unfortunately, the chip has reportedly been utilized by the Chinese AI startup DeepSeek for training advanced models, intensifying scrutiny from U.S. authorities.
Although the Trump administration initially delayed these restrictions after a discussion between President Donald Trump and Nvidia CEO Jensen Huang, that decision has since been revoked.
This shift in policy comes amid rising calls to impose stricter export controls on advanced semiconductor technologies.
On April 14, Nvidia unveiled plans to invest hundreds of millions of dollars into domestic AI chip manufacturing over the next four years, a move aimed at mitigating investor concerns. However, it did little to assuage worries about the pending financial impacts.
Nvidia’s stock saw a decline of 6% in after-hours trading, settling at $105, while AMD experienced a drop exceeding 7%, reaching $88.55. Since the beginning of the year, Nvidia shares have fallen by 22%, and AMD has faced a loss of over 25%.
The negative sentiment extended to the broader market, with analysts expressing concerns that even leading tech companies may be at risk due to escalating geopolitical tensions and increasing trade restrictions.
Bitcoin May Experience Prolonged Consolidation Despite Optimistic Forecasts: 10x Research
According to Markus Thielen, head of research at 10x Research, Bitcoin could be entering a phase of extended consolidation. In a recent market commentary, he cautioned that short-term technical indicators present a more guarded outlook, despite some analysts projecting the potential for new all-time highs by mid-year.
Thielen highlighted the Bitcoin stochastic oscillator, a tool used to measure momentum, which suggests that market conditions are more indicative of a late-cycle peak rather than the start of a new bull market.
While Thielen advises caution, other analysts hold a more optimistic view.
Economists Timothy Peterson and Jamie Coutts, the chief crypto analyst at Real Vision, predict Bitcoin could achieve record prices in Q2.
Bitcoin is trading near the low end of its historical seasonal range. Nearly all of Bitcoin’s annual performance occurs in two months: April and October. It is entirely possible Bitcoin could reach a new all-time high before June. pic.twitter.com/p8upTNAkKH
— Timothy Peterson (@nsquaredvalue) March 15, 2025
Recently, Bitwise Chief Investment Officer Matt Hougan reaffirmed his December prediction that Bitcoin could potentially reach $200,000 by the end of 2025. Hougan noted that recent evolutions in U.S. trade policies, particularly those linked to former President Trump’s renewed tariff initiatives, might serve as catalysts for Bitcoin’s ascent.
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