BANGKOK – Following Nvidia’s announcement of facing tighter U.S. government controls on exports of computer chips used for artificial intelligence, shares in computer chip makers experienced a decline in after-hours trading and in Asia. The company revealed that these stricter regulations will lead to an additional cost of $5.5 billion.
Nvidia disclosed its decision to start manufacturing its artificial intelligence super computers in the United States, marking a significant shift. The government informed Nvidia that its H20 integrated circuits and similar products of equivalent bandwidth would fall under these controls for the foreseeable future.
According to a regulatory filing, the government’s rationale behind these controls is to mitigate the risk of these products being utilized in or redirected to a supercomputer based in China.
Nvidia’s shares fell 6.3% in after-hours trading. Shares in rival chip maker AMD dropped 7.1% after markets closed.
Asian technology giants also saw big declines. Testing equipment maker Advantest’s shares fell 6.7% in Tokyo, Disco Corp. lost 7.6% and Taiwan’s TSMC dropped 2.4%.
Earlier, reports had said the Trump administration had backed away from imposing stricter licensing requirements on the H20 chip. Commerce Department officials were not immediately available for comment early Wednesday.
Nvidia said Monday it has commissioned more than one million square feet of manufacturing space to build and test its specialized Blackwell chips in Arizona and AI supercomputers in Texas — part of an investment the company said will produce up to half a trillion dollars of AI infrastructure in the next four years.
The announcement comes after President Donald Trump and other officials said tariff exemptions on electronics like smartphones and laptops were only a temporary reprieve until officials develop a new tariff approach specific to the semiconductor industry.
Trump claimed that decision as a victory for his effort to expand manufacturing in the U.S.
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