NVIDIA (NVDA, Financial) shares fell by 6.87%, closing at $104.49 with a market capitalization of $2.55 trillion. At one point, the stock plummeted by 10%. The decline follows NVIDIA's announcement that the U.S. government is imposing restrictions on its H20 chip exports to certain countries and regions. This move severely affects a product line previously designed to circumvent former export controls.
NVIDIA disclosed in regulatory filings that the U.S. government informed the company that future exports of the H20 chips to specific countries would require "indefinite" licensing. This new regulation arises from concerns that these chips could be used or repurposed for supercomputers in other countries. As a result, NVIDIA will incur approximately $5.5 billion in costs this fiscal quarter related to the H20 series chips, including inventory, procurement commitments, and related reserves.
