As the U.S.–China tariff battle intensifies, Wedbush analysts say companies like Nvidia (NVDA, Financial) — and the broader tech sector — urgently need clarity and a defined negotiation strategy. In a client note, analyst Daniel Ives said the back-and-forth tariff shifts under former President Trump have likely pushed the economy closer to recession.
According to Ives, uncertainty from stalled capital expenditures, frozen hiring, and supply chain disruptions has created economic conditions reminiscent of the COVID era — only this time, driven by policy.
Nvidia's disclosure last week that its H20 chips are now subject to U.S. export restrictions added another layer of strain. The company could take a $5.5 billion hit as a result, contributing to a more than 5% drop in shares during early Monday trading.
Wedbush remains optimistic on the long-term tech outlook, especially around artificial intelligence, but expects near-term volatility. The firm estimates a roughly 10% cut to 2025 earnings expectations across tech, with the June quarter seen as a reset.
Nvidia CEO Jensen Huang, who recently traveled to China for meetings, emphasized the market's importance and expressed hope for ongoing cooperation. Still, Wedbush believes Washington is unlikely to allow high-end chips to reach China during this strategic standoff.
