Submitted by Arsheya Bajwa
(Reuters) – NVIDIA investors will look for final answers about how much US chips in China will cost the company when it reports results on Wednesday, even if the retreat of other rules is expected to open up new markets.
Last month, Trump’s administration found the NVIDIA H20 chip export restrictions on Beijing’s most advanced technologies – a step that the company said would pay 5.5 billion dollars.
General Manager Jensen Huang, who recorded the AI chip market next year in China about $ 50 billion, said last week that NVIDIA had been out of $ 15 billion in the country’s sidewalks.
NVIDIA does not retain the H20 – the only AI chip that was allowed to be sold to China, the market, which last year was allowed by 13% of its income.
“The main question about results and recommendations is that NVIDIA sales are sufficiently sold to compensate for the loss of H20 or Chinese business,” Wedbush analysts said before the Income Report.
Although Reuters sources said the company is planning to release a new set of chips in China, based on the latest NVIDIA Blackwell architecture, uncertainty to lose its Chinese business has increased its stock.
Promotions were already under pressure from concern about AI infrastructure costs. This year it decreased by 2%, it was far from almost three times last year.
“China will probably be the biggest factor in the NVIDIA quarter,” said Davson analyst Giluria.
The company is expected to report that the first quarter’s revenue increased by 66.2% to $ 43.28 billion based on LSEG data.
Susquehanna analysts estimated that the restrictions had an impact on the last three -quarters of April and NVIDIA cost about $ 1 billion.
They said that the remaining year’s lost income could reach $ 4.5 billion a quarter. Wedbush estimated the quarterly stroke of $ 3 to $ 4 billion.
The general margin is expected to decrease by more than 11 percentage points to 67.7%. Writings related to H20 shipments can turn a common margin up to 12.5%, said Wedbush.
Huang, CEO of NVIDIA, recently called us “failure” in China, saying that they only pushed Chinese competitors such as Huawei to accelerate the development of homemade chips.
New regions
However, Washington said he intends to modify the export curve of the biden era, known as the AI diffusion rule, aimed at curb the complex AI tokens exports by dividing the world into three steps and China completely blocked.