Latest news with #H20Chip
Zawya
2 days ago
- Business
- Zawya
Nvidia discloses more China risks, but CEO praises Trump
SAN FRANCISCO - Even as Nvidia reported another blockbuster quarter of 69% sales growth on Wednesday, the maker of artificial intelligence chips warned of more risks to its business emerging in the technology conflict between the U.S. and China. Tucked into Nvidia's quarterly filing with U.S. securities regulators, Nvidia for the first time said that restrictions on the use of open-source AI models from China such as DeepSeek and Qwen could hurt its business, as could U.S. rules barring connected vehicle technology from China, where Nvidia's long-struggling car chip business has finally flourished. While Nvidia CEO Jensen Huang on a conference call with analysts praised U.S. President Donald Trump's decision to rescind an export rule put in place by President Joe Biden that would have regulated the flow of Nvidia's chips around the world, the company's quarterly filing noted that no new rule had been issued in its place and that a "replacement rule may impose new restrictions on our products or operations." On the other hand, Huang criticized new export curbs imposed by the Trump administration in April. The curbs stop the company from selling its H20 chip made for the Chinese market, which Huang called "a springboard to global success." The export limits cost Nvidia $2.5 billion in sales during its just-ended fiscal first quarter, and it expects another $8 billion sales hit during the current fiscal second quarter. Sales of the H20 in China earned Nvidia $4.6 billion in revenue as customers stockpiled the chips before the curbs set in. The China business accounted for 12.5% of overall revenue. "The question is not whether China will have AI - it already does. The question is whether one of the world's largest AI markets will run on American platforms," Huang said, later adding that "AI export controls should strengthen U.S. platforms, not drive half of the world's AI talent to rivals." Huang also argued that keeping Chinese open-source models such as DeepSeek and Qwen running on Nvidia chips provides U.S. firms with valuable insight on where the global AI industry is headed. "U.S. platforms must remain the preferred platform for open-source AI," he said. "That means supporting collaboration with top developers globally, including in China. America wins when models like DeepSeek and Qwen run best on American infrastructure." SALES GROWTH POWERS ON Despite the curbs, Nvidia forecast sales of $45 billion, plus or minus 2%, in the second quarter, only slightly below analysts' average estimate of $45.90 billion, according to data compiled by LSEG. That would imply growth of about 50% from a year earlier. Executives also highlighted deals worth potentially billions of dollars in the coming months and years in Saudi Arabia, the United Arab Emirates and Taiwan, sending Nvidia shares up after hours and leading analysts to conclude the impact of U.S.-China trade tensions was not as bad as feared. "Rather than downplay the China hit, (Huang) contextualized it as a known, manageable speed bump in an otherwise hyper-accelerated growth narrative," said Michael Ashley Schulman, chief investment officer of Running Point Capital. In his praise for Trump, Huang highlighted the President's deal-filled tour of the Middle East. "President Trump wants U.S. tech to lead," Huang said. "The deals he announced are wins for America, creating jobs, advancing infrastructure, generating tax revenue and reducing the U.S. trade deficit." Huang also said that he agreed with a vision expressed by cabinet officials such as Commerce Secretary Howard Lutnick of bringing factories back to the United States and staffing them with robots. "Future plants will be highly computerized in robotics. We share this vision," Huang said. (Reporting by Stephen Nellis in San Francisco, Additional reporting by Arsheeya Bajwa in Bengaluru; Editing by Sayantani Ghosh and Sonali Paul)
Reuters
2 days ago
- Business
- Reuters
Nvidia discloses more China risks, but CEO praises Trump
SAN FRANCISCO, May 28 (Reuters) - Even as Nvidia reported another blockbuster quarter of 69% sales growth on Wednesday, the maker of artificial intelligence chips warned of more risks to its business emerging in the technology conflict between the U.S. and China. Tucked into Nvidia's quarterly filing with U.S. securities regulators, Nvidia for the first time said that restrictions on the use of open-source AI models from China such as DeepSeek and Qwen could hurt its business, as could U.S. rules barring connected vehicle technology from China, where Nvidia's long-struggling car chip business has finally flourished. While Nvidia CEO Jensen Huang on a conference call with analysts praised U.S. President Donald Trump's decision to rescind an export rule put in place by President Joe Biden that would have regulated the flow of Nvidia's chips around the world, the company's quarterly filing noted that no new rule had been issued in its place and that a "replacement rule may impose new restrictions on our products or operations." On the other hand, Huang criticized new export curbs imposed by the Trump administration in April. The curbs stop the company from selling its H20 chip made for the Chinese market, which Huang called "a springboard to global success." The export limits cost Nvidia $2.5 billion in sales during its just-ended fiscal first quarter, and it expects another $8 billion sales hit during the current fiscal second quarter. Sales of the H20 in China earned Nvidia $4.6 billion in revenue as customers stockpiled the chips before the curbs set in. The China business accounted for 12.5% of overall revenue. "The question is not whether China will have AI - it already does. The question is whether one of the world's largest AI markets will run on American platforms," Huang said, later adding that "AI export controls should strengthen U.S. platforms, not drive half of the world's AI talent to rivals." Huang also argued that keeping Chinese open-source models such as DeepSeek and Qwen running on Nvidia chips provides U.S. firms with valuable insight on where the global AI industry is headed. "U.S. platforms must remain the preferred platform for open-source AI," he said. "That means supporting collaboration with top developers globally, including in China. America wins when models like DeepSeek and Qwen run best on American infrastructure." Despite the curbs, Nvidia forecast sales of $45 billion, plus or minus 2%, in the second quarter, only slightly below analysts' average estimate of $45.90 billion, according to data compiled by LSEG. That would imply growth of about 50% from a year earlier. Executives also highlighted deals worth potentially billions of dollars in the coming months and years in Saudi Arabia, the United Arab Emirates and Taiwan, sending Nvidia shares up after hours and leading analysts to conclude the impact of U.S.-China trade tensions was not as bad as feared. "Rather than downplay the China hit, (Huang) contextualized it as a known, manageable speed bump in an otherwise hyper-accelerated growth narrative," said Michael Ashley Schulman, chief investment officer of Running Point Capital. In his praise for Trump, Huang highlighted the President's deal-filled tour of the Middle East. "President Trump wants U.S. tech to lead," Huang said. "The deals he announced are wins for America, creating jobs, advancing infrastructure, generating tax revenue and reducing the U.S. trade deficit." Huang also said that he agreed with a vision expressed by cabinet officials such as Commerce Secretary Howard Lutnick of bringing factories back to the United States and staffing them with robots. "Future plants will be highly computerized in robotics. We share this vision," Huang said.
The National
3 days ago
- Business
- The National
Nvidia gives strong forecast despite chip export controls
Nvidia on Wednesday forecast strong growth for the second quarter of the 2026 fiscal year, despite a loss in revenue due to export controls on its H20 AI chips to China. Nvidia expects revenue of $45 billion in the second quarter, plus or minus 2 per cent. That comes after taking an $8 billion hit due to export control limits related to the H20 chip. Nvidia beat first-quarter estimates, reporting revenue of $44.1 billion, up 69 per cent from a year ago. Analysts polled by Factset expected the company to record first-quarter revenue of $43 billion. Nvidia said it made a profit of $18.8 billion. Data centre revenue came in at $39.1 billion, compared to $22.5 billion for the same time last year. The earnings came weeks after Nvidia announced major partnerships with the UAE and Saudi Arabia during US President Donald Trump 's visit to the Gulf. Mr Huang was also present at the unveiling of the UAE-US AI Campus in Abu Dhabi during Mr Trump's visit. NVidia has also joined OpenAI, Oracle and Abu Dhabi's G42 to build Stargate UAE, which will operate in the campus. And before Mr Trump's visit to Riyadh, Nvidia joined Amazon Web Services and Advanced Micro Devices to collaborate with Humain, the Saudi Public Investment Fund's new AI company. Nvidia has a similar agreement in Taiwan. "We have a line of sight to projects requiring tens of gigawatts of Nvidia AI infrastructure in the not-too-distant future," Nvidia chief financial officer Colette Kress said during a conference call. Chief executive Jensen Huang said: 'Countries around the world are recognising AI as essential infrastructure – just like electricity and the internet – and Nvidia stands at the centre of this profound transformation." Mr Huang also said global demand remains "incredibly strong". Meanwhile, the Blackwell NVL72 AI supercomputer, which he called a "thinking machine designed for reasoning", is in full-scale production. Nvidia shares rose more than 5 per cent to $140.09 during after-hours trading. Its stock was virtually flat when trading closed on Wednesday, 0.51 per cent lower at $134.81 a share. Nvidia was among a number of tech giants that suffered large drops in share price after Mr Trump first announced his larger-than-expected tariff policy last month. But like other companies trading on Wall Street, it has since recovered. China drove much of the attention on Wednesday after the Trump administration had placed stricter export controls on Nvidia's H20 AI chip in April. Nvidia said it incurred a $4.5 billion charge in the first quarter of the 2026 fiscal year because of those controls on China. It had previously warned the latest export rules would cause it to take a hit of $5.5 billion in inventory write-off. During the conference call, Mr Huang said Nvidia cannot reduce its Hopper chip further to comply with the latest chip controls. "As a result, we are taking a multibillion-dollar write-off on inventory that cannot be sold or repurposed," Mr Huang said. Commenting on the latest controls, he said shielding Chinese companies from American competition "only strengthens them abroad and weakens America's position". 'Nvidia was banking that the Trump administration was not going to block their exports of these H20 AI chips,' said Gregory Allen, director of the Wadhwani AI Centre at the Centre for Strategic and International Studies 'The Trump administration has gotten tougher on China even as it has gotten lighter on restrictions placed on other places around the world, like the UAE, like Saudi Arabia,' Mr Allen told CNBC earlier on Wednesday.
The National
3 days ago
- Business
- The National
Nvidia gives strong forecast despite chip-export controls
Nvidia on Wednesday forecast strong growth for the second quarter of the 2026 fiscal year, despite a loss in revenue due to export controls on its H20 AI chips to China. Nvidia expects revenue of $45 billion in the second quarter, plus or minus 2 per cent. That comes after taking an $8 billion hit due to export control limits related to the H20 chip. Nvidia beat first-quarter estimates, reporting revenue of $44.1 billion, up 69 per cent from a year ago. Analysts polled by Factset expected the company to record first-quarter revenue of $43 billion. The earnings came weeks after Nvidia announced major partnerships with the UAE and Saudi Arabia during US President Donald Trump 's visit to the Gulf. 'Countries around the world are recognising AI as essential infrastructure – just like electricity and the internet – and Nvidia stands at the centre of this profound transformation,' its chief executive Jensen Huang said in a statement. Nvidia shares rose more than 4.50 per cent to $139.36 during after-hours trading. Its stock was virtually flat when trading closed on Wednesday, closing 0.51 per cent lower at $134.81 a share. China drove much of the attention on Wednesday, with the Trump administration placing stricter export controls on Nvidia's H20 AI chip. Nvidia said it incurred a $4.5 billion charge in the first quarter of the 2026 fiscal year because of those controls on China. It had previously warned the latest export rules would cause it to take a hit of $5.5 billion in inventory write-off. 'That's because Nvidia was banking that the Trump administration was not going to block their exports of these H20 AI chips,' said Gregory Allen, director of the Wadhwani AI Centre at the Centre for Strategic and International Studies 'The Trump administration has gotten tougher on China even as it has gotten lighter on restrictions placed on other places around the world, like the UAE, like Saudi Arabia,' Mr Allen told CNBC earlier on Wednesday. Nvidia and Mr Huang were a major presence during Mr Trump's visit to the Gulf this month. Mr Huang was also present at the unveiling of the UAE-US AI Campus in Abu Dhabi during Mr Trump's visit. NVidia has also joined OpenAI, Oracle and Abu Dhabi's G42 to build Stargate UAE, which will operate in the campus. And before Mr Trump's visit to Riyadh, Nvidia joined Amazon Web Services and Advanced Micro Devices to collaborate with Humain, the Saudi Public Investment Fund's new AI company. 'Together with Humain, we are building AI infrastructure for the people and companies of Saudi Arabia to realise the bold vision of the kingdom,' Mr Huang said.
Yahoo
16-04-2025
- Business
- Yahoo
Global chip stocks slide as Nvidia warns of big hit from U.S. export curbs
(Reuters) - Global chip stocks slumped on Wednesday after Washington curbed exports of an AI chip Nvidia had tailored for China, further cutting off the crucial growth market for semiconductors in a move that will cost the AI pioneer $5.5 billion in charges. Nvidia said the charges it would incur is a result of U.S. restricting the export of its H20 AI chip to China, along with AMD's MI308 and their equivalents. The export curbs to China have in recent years squeezed U.S. companies, but the country remains a crucial revenue source with Nvidia drawing more than 13% of its sales, or some $17 billion, from China in its last fiscal year. Meanwhile, ASML, the world's biggest supplier of computer chip-making equipment, cautioned that tariffs were adding to the uncertainty for its outlook for 2025 and 2026, sending its shares down over 4%. "We are not surprised that there are limits to the constraint there is supply, so a more sudden reduction in H20 - and given the inventory writedown, a higher revenue expectation going forward for H20 - will likely be disruptive to revenue and earnings," Morgan Stanley analysts said. Shares of Nvidia were down 5%, AMD dropped over 6%, while Micron Technology, Broadcom and Intel fell between 2% to 4% in premarket trading. Stacy Rasgon, a Bernstein analyst, said banning the H20 Chip 'makes no sense' as it would hand over the Chinese AI market to rivals Huawei. U.S. officials have been aiming to prevent the sale of critical chip to China in an effort to maintain a competitive edge in the AI race. "The impact of a full H20 wipeout is probably (about)30 cents or so at current levels (not enormous in the grand scheme of things)," Rasgon said. Sign in to access your portfolio
