After-hours trading on Wednesday saw a nearly 6% drop in Nvidia Corp. (NVDA) shares due to President Donald Trump’s declaration of “Liberation Day” tariffs. Trump declared that he will impose reciprocal tariffs of 20% on Europe, 34% on China, and 32% on Taiwan. Until then, a 10% global base tariff will apply to all nations as of April 5.

The tariff announcement caused the chipmaker’s stock price to drop by around 5.7%. Nvidia produces its chips in Taiwan and assembles its AI systems in Mexico and other nations. Following the announcement of the levies, Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), a manufacturer of cutting-edge semiconductors for Nvidia and other companies, saw a decrease of more than 6% in after-market hours. According to Wedbush analysts, Nvidia and other chipmakers that have logistics networks in China and Taiwan would be concerned about how the hefty tariffs will affect their pricing and margins.

Jensen Huang, the CEO of Nvidia, had previously stated that the business anticipates the possible tariffs to have little immediate effect and will eventually move production to the United States if needed. Retail attitude toward Nvidia on Stocktwits jumped from “bearish” (42/100) to “neutral” (50/100) a day ago. In the very initial quarter of 2025, ByteDance, Alibaba Group, and Tencent Holdings placed orders for $16 billion worth of H20 server chips, demonstrating the size of the Chinese market for Nvidia.

Nvidia’s stock has dropped by around 18% so far this year. According to trade data provided by supply chain expert and Michigan State University professor Jason Miller, the United States imported approximately $19 billion worth of “computers” from Taiwan and $34 billion from China in 2024. This category includes servers outfitted with Nvidia’s CPUs.