Nvidia Warns of $5.5bn Writedown as US Tightens Export Curbs
The Trump administration’s new export restrictions on Nvidia’s H20 chip to China could cost the company billions of dollars and severely impact a product line created specifically to comply with earlier US restrictions.
On 9 April 2025, the US government informed Nvidia that it would require a license to export H20 chips to China. On 14 April, the government further informed the company that the license requirement will be in effect “for indefinite future.”
The government also told the company that the new license requirement addresses the risk that “the covered products may be used in, or diverted to, a supercomputer in China,” Nvidia said in a filing.
Nvidia warned it will report about $5.5bn in writedowns during the first quarter 2026 that ends on 27 April 2025, linked to inventory and commitments for the H20 chip.
The company developed the H20 chip in response to 2023 restrictions that targeted another China-specific processor, the H800, which was introduced after earlier export controls. While the H20 is intentionally less powerful and doesn’t match Nvidia’s flagship chips in training AI models, it remains capable of supporting AI software and services. It is suitable for the inference phase—where AI systems analyse data, recognise patterns, and make decisions, reported Bloomberg.
The decision to curb H20 exports comes amid ongoing tensions between Washington and Beijing over technology.
The US government has taken a progressively aggressive stance on restricting China’s access to semiconductors and chipmaking tools, citing national security concerns.
Since October 2022, US officials have widened the scope of bans to include high-bandwidth memory chips and other components critical for AI applications.
Earlier in April 2025, Nvidia announced plans to manufacture up to $500bn of AI supercomputers within the US over the next four years.
The initiative is said to mark the first time the company’s AI infrastructure will be fully produced in the US, as it collaborates with global manufacturing partners to establish and operate advanced production facilities.
