J.P. Morgan is warning that newly imposed U.S. export restrictions on AI chips could reduce 2025 earnings per share (EPS) by 8% to 10% for both Nvidia (NVDA, Financial) and Advanced Micro Devices (AMD, Financial). The analysis follows the U.S. government's move to require special licenses for exporting Nvidia's H20 and AMD's MI308 chips to China.
Nvidia has already flagged a $5.5 billion inventory charge tied to halted shipments, while AMD expects an $800 million hit. J.P. Morgan's analysts, led by Harlan Sur, estimate that—assuming gross margins between 65% and 67%—Nvidia's $5.5 billion charge implies a $15 billion to $16 billion revenue impact, or roughly 8% to 10% of its $180 billion in projected datacenter revenue.
For AMD, the projected earnings impact is similarly steep. J.P. Morgan assumes a 45% to 55% margin on AMD's anticipated $800 million inventory charge, translating to $1.5 billion to $1.8 billion in revenue risk out of an anticipated $8 billion GPU segment and anticipated $16 billion in total datacenter sales.
In total, the firm expects Nvidia and AMD's merchant GPU revenue losses to shave 8% to 10% off their 2025 earnings, underscoring how geopolitical policies are weighing directly on the AI chip sector's growth story.
