NVIDIA Projects Multi-Billion Dollar Revenue Loss Due to H20 Chip Licensing Restrictions

NVIDIA, in its financial report for the first quarter of fiscal year 2026 ending April 28, disclosed that it incurred $4.5 billion in charges during the quarter due to U.S. export restrictions under the Trump administration, which imposed licensing requirements affecting sales of its H20 artificial intelligence chips. As a result, the company was unable to deliver $2.5 billion in H20 chip revenue during the same period.

In April, when the U.S. government first introduced the licensing requirement, NVIDIA had estimated a related quarterly charge of $5.5 billion. The company also noted that these restrictions are expected to reduce its second-quarter revenue by $8 billion, with total revenue for the quarter projected at approximately $45 billion.

During the earnings call, CEO Jensen Huang stated that NVIDIA is assessing options to remain competitive in China’s AI market but has had to write down H20 chip assets. Huang emphasized that China, contributing significantly to global AI research, represents one of the largest AI markets globally. However, the $50 billion market is now effectively inaccessible to NVIDIA due to the H20 export ban, which has halted the company’s Hopper data center business.

Huang also acknowledged the recent repeal of the AI Proliferation Rule by the U.S. government. While the Biden administration’s rule did not take effect, NVIDIA continues to face the impact of previous restrictions enacted under the Trump administration.