A White House official called the new 25% tariff on specific high-end semiconductors a "phase one" measure. The official indicated that further actions are possible following discussions with other nations and companies. This statement introduces new uncertainty for NVIDIA’s business in China, which already navigates complex export restrictions.
Bernstein analysts released a report coinciding with the announcement. The analysts predict NVIDIA’s dominant 66% share of the Chinese AI market could collapse to just 8% in the near future.
The analysis suggests US export controls accelerate the adoption of domestic solutions. Competitors like Huawei are gaining ground, creating a significant long-term revenue risk for NVIDIA in the region.