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Nvidia’s A100 chip is used in data centers for high-performance applications like artificial intelligence.
Courtesy NVIDIA
Nvidia cannot rest.
Late Wednesday, chip maker said in a profile The US government has notified the company that it has imposed a new licensing requirement, effective immediately, covering any upcoming exports of Nvidia’s A100 and H100 products to China, including including Hong Kong and Russia.
Nvidia’s A100 is used in data centers for artificial intelligence, data analytics and high-performance computing applications, according to the company’s website.
The government “indicates that the new license requirement will address the risk that protected products could be used or diverted to “military end use” or “military end users.” “in China and Russia,” the filing said.
Nvidia
(code:
NVDA
) shares fell 5.5% to $142.70 shortly after the market open on Thursday. Chip manufacturer
Advanced Microphone Device
(AMD) fell 3.4%. AMD said it was also notified of the new US licensing request, but it does not expect the change to have a significant effect on its business.
Nvidia said it doesn’t sell any products to Russia, but noted that its current outlook for the third fiscal quarter already includes about $400 million in potential revenue to China that could be affected. by new license requirements. The company also said the new restrictions could affect its ability to develop its H100 product on time and potentially force it to move some operations out of China.
An Nvidia spokesperson told Barron’s in an email: “We are working with our customers in China to meet their planned or future purchasing needs with alternative products and may seek licenses in In case there are not enough substitute products. The only current products that apply the new licensing requirement are the A100, H100, and systems like the DGX that include them. “
The latest developments come after a series of weak financial results for Nvidia. Last week, the company gave a revenue Forecasts for the October quarter were significantly lower than expected, citing a difficult macroeconomic environment and a rapid slowdown in demand.
Last Friday, Barron’s speak Chipmakers have more trouble ahead, and investors looking for a quick turnaround are likely to be disappointed.
Nvidia shares are down about 49% this year, compared with a 32% drop in
iShares Semiconductor ETF
(SOXX), which tracks the performance of the ICE Semiconductor Index.
Write to Tae Kim at tae.kim@barrons.com
