Nvidia to exclude China from forecasts amid US chip export curbs

New Straits Times

20 hours ago

KUALA LUMPUR: Nvidia will no longer include the China market in its revenue and profit forecasts following stringent US trade restrictions on chip sales to the region, CEO Jensen Huang told CNN on Thursday.
When asked if the United States would lift the export controls after the trade discussions with China in London this week, Huang said he was not counting on it.
"But, if it happens, then it will be a great bonus. I've told all of our investors and shareholders that, going forward, our forecasts will not include the China market," he said.
Huang reiterated his criticism of US chip export curbs during his CNN interview, building on his earlier remarks about the restrictions from April that prevented Nvidia from selling its H20 chip made for China.
"The goals of the export controls are not being achieved," he said. "And so I think, with all export controls, the goals have to be well-articulated and tested over time."
"Beyond next quarter, if Nvidia is not able to resume sales into China, we believe there may be some downside to expectations for calendar year 2026," said D.A. Davidson analyst Gil Luria.
Nvidia was still evaluating its "limited options for the China market", it said on Thursday.
"Until we settle on a new product design and receive approval from the US government, we are effectively foreclosed from China's US$50 billion data center market," the company said.
The export limits cost it US$2.5 billion in sales during the first quarter and it expects an US$8 billion sales hit in the second quarter.
"By zero-basing China, Nvidia removes a volatile variable that neither Wall Street nor the Commerce Department can reliably handicap," said Michael Ashley Schulman, CIO of Running Point Capital, adding that any China sales would come as an upside surprise.
The company reported US$4.6 billion in first-quarter revenue from H20 sales as customers stockpiled the chips before the export controls set in, with the China business accounting for 12.5 per cent of overall revenue.