Chip stocks fall as Nvidia, AMD warn of China export control costs

Technology stocks declined Wednesday, led by a 6% drop in Nvidia, as the chipmaking sector signaled that President Donald Trump’s sweeping tariff plans could hamper demand and growth.

Nvidia revealed in a filing Tuesday that it will take a $5.5 billion charge tied to exporting its H20 graphics processing units to China and other countries and said that the government will require a license to ship the chips there and other destinations.

The chip was designed specifically for China use during President Joe Biden’s administration to meet U.S. export restrictions barring the sale of advanced AI processors, which totaled an estimated $12 billion to $15 billion in revenue in 2024. Advanced Micro Devices said in a filing Wednesday that the latest export controls on its MI308 products could lead to an $800 million hit.

Tech volatility

Technology stocks have whipsawed in the wake of Trump’s tariff announcements, which sparked global trade war fears and recession concerns.

The market slumped in the initial aftermath of the sweeping policy plans, pushing megacap technology stocks dubbed the “Magnificent Seven” to shave off more than $1.8 trillion in market value over two trading days. Markets saw more wild turbulence as Trump later announced a 90-day pause on most reciprocal tariffs, sending the Nasdaq Composite to its second-best session ever last week.

Many technology stocks have bounced from their low, but Apple and Meta Platforms are down more than 10% each so far this month, while Amazon has slumped about 7%. Nvidia and Tesla are down more than 3% each.

WATCH: Chip stocks fall as Nvidia, AMD warn of higher costs from China export controls