Chipmaker beats quarterly expectations but faces $8 billion revenue hit from trade curbs. Nvidia’s stock gushed 5% in extended trading Wednesday after the semiconductor giant reported better-than-expected quarterly results regardless of how new U.S. export restrictions on China are set to significantly impact sales in the future.

The most valuable semiconductor company globally beat first-quarter sales expectations as customers stockpiled AI chips before the fresh U.S. curbs on China exports took effect. However, the same restrictions will slice $8 billion from the company’s current quarter revenue, forcing Nvidia to offer a forecast below Wall Street estimates.

Investors were relieved that the impact wasn’t as negative as they predicted. The company also accentuated strong demand for its new Blackwell chips from major customers, including Microsoft.

China Revenue Impact Less Severe Than Feared

The H20 chips were the only AI processors that the chipmaker could legally export to China. Nvidia disclosed that U.S. restrictions on its H20 chips resulted in a $4.5 billion charge in the first quarter, which was $1 billion less than the $5.5 billion initially expected. The company was also able to reuse some materials, which reduced the overall impact.

With H20 chips bringing in $4.6 billion in sales, China accounted for 12.5% of Nvidia’s overall revenue in the first quarter. Chinese buyers had stockpiled chips ahead of the restrictions, which immensely assisted in propping up quarterly results.

“Chinese buyers were stocking up on H20 ahead of the restrictions, which is what propped up the April quarter,”

said Gil Luria, an analyst with D.A. Davidson.

CEO Addresses Trade Policy

During the earnings call, CEO Jensen Huang made impassioned remarks about U.S.-China policy, warning that Nvidia risked being cut off from China’s massive AI developer base. He also praised President Trump’s recent decision to revoke an AI diffusion rule that would have regulated global flows of U.S. AI chips.

“President Trump wants America to win. And he also realizes that we’re not the only country in the race,”

Huang said.

What’s Next for NVIDIA?

Nvidia expects second-quarter revenue of $45 billion, plus or minus 2%, compared to analysts’ average estimate of $45.90 billion. The forecast includes the anticipated $8 billion loss from H20 revenue restrictions.

The company is exploring new growth avenues, including data centre projects in the Middle East, Saudi Arabia, and Taiwan, though these are unlikely to fully offset Chinese revenue losses in the near term.