Nvidia Corp. (NVDA, Financials) shares dropped almost 15% over two trading sessions last week, as investors reacted to concerns over newly proposed U.S. tariffs that could hurt companies reliant on artificial intelligence hardware imports.
The proposed measures, announced by the administration of President Donald J. Trump, are expected to impose significant costs on imports of AI server equipment, with potential implications for Nvidia's supply chain. The decline came amid broader fears about how tariff policy could disrupt global semiconductor production and logistics, particularly for advanced chips used in AI infrastructure.
Despite the selloff, one analyst said Nvidia may avoid the full impact of the proposed tariffs. Bernstein analyst Stacy Rasgon examined Nvidia's latest regulatory filings and said some of the company's AI server shipments to the United States appear to originate from Mexico. If confirmed, these goods may be exempt from the tariffs under existing trade agreements.
Because imports from Mexico generally face fewer restrictions than those from China or Taiwan, Nvidia could potentially avoid higher import duties on certain products. That exemption could help preserve margins on part of its U.S. business, Rasgon said.
The findings offer a narrow source of optimism at a time when Nvidia's stock has come under pressure. Nvidia's shares, which have been among the top-performing U.S. equities over the past two years, now face heightened volatility as markets evaluate regulatory risks tied to international trade policy.
Rasgon's analysis comes as investors reassess chipmakers with exposure to global supply chains, including Advanced Micro Devices (AMD, Financials), Intel Corp. (INTC, Financials), and Qualcomm (QCOM, Financials). The potential tariff exemptions could provide Nvidia with a competitive edge if other companies are more directly impacted.
The White House has not yet finalized the tariff measures, and details on exemptions remain limited.
