How did the 2025 U.S. license rule disrupt Nvidia and AMD chip sales to China?
The April 2025 licensing requirement turned Nvidia’s H20 and AMD’s MI308 into controlled exports, immediately putting inventory, shipments and expected revenue at risk. Nvidia subsequently recorded a $4.5 billion H20 charge, could not ship $2.5 billion of product, and expected a further $8 billion hit; AMD projected about $1.5 billion less 2025 revenue, including $700 million in the second quarter. U.S. assurances that licenses would be granted and that MI308 applications would again be reviewed offered a route to restart shipments, but they did not restore sales by themselves. Nvidia recorded no H20 sales to China-based customers in the second quarter and assumed no such shipments in its third-quarter outlook. China also raised H20 security concerns and discouraged its use in government- and security-related work, and Nvidia later said H20 sales were insignificant in the third quarter. Companies therefore had to treat a U.S. license as necessary but not sufficient for China revenue.
Trace the chain
The US cutoff
- 1H20 needs a licenseRegulatory
US requires a license for H20 exports to China; Nvidia flags up to US$5.5 billion in charges
Nvidia disclosed that on April 9 the government required a license for exports of H20 and any chip with its memory or interconnect bandwidth to China, Hong Kong, Macau and D:5 countries, and on April 14 said the requirement would apply indefinitely. Nvidia expected up to about US$5.5 billion of first-quarter charges for H20 inventory, purchase commitments and reserves.
Nvidia Form 8-K ·
On April 9, 2025, the U.S. government, or USG, informed NVIDIA Corporation, or the Company, that the USG requires a license for export to China (including Hong Kong and Macau) and D:5 countries, or to companies…
Why it matters here. The H20 requirement covered chips with specified memory or interconnect bandwidth, so AMD disclosed that the same new rule covered its MI308 exports.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- 2MI308 also coveredRegulatory
New license requirement hits the MI308; AMD warns of up to $800 million in charges
A day after Nvidia disclosed the H20 license requirement and a $5.5 billion charge, AMD filed an 8-K saying the same new rule covered exports of its MI308 to China, Hong Kong, Macau and other D:5 countries. It expected up to $800 million of inventory, purchase-commitment and reserve charges, said it would apply for licenses with no assurance of approval, and its shares fell more than 7 percent.
AMD Form 8-K (SEC) ·
The Export Control applies to the Company’s MI308 products. The Company expects to apply for licenses but there is no assurance that licenses will be granted. The Company expects that the Export Control may result in…
Why it matters here. The MI308 licensing requirement and potential charge made its commercial impact material, so AMD quantified the revenue it expected to lose under the rule.
US Export Controls on AMD's AI Chips in China: From the MI250 License to MI308 and MI325X
- 3AMD forecasts lost revenueFinancial
Q1 2025: AMD puts the MI308 hit at $1.5 billion of 2025 revenue, $700 million of it in Q2
Reporting first-quarter results, CFO Jean Hu said the export license requirement removed an estimated $700 million from second-quarter revenue and about $1.5 billion for the year, mostly in the second and third quarters. The next morning Su told CNBC that China was a 'large opportunity' and argued for a balance between national-security controls and the widest possible adoption of US technology.
NBC News (CNBC) ·
AMD topped earnings and expectations and issued strong guidance, but said it would see a $1.5 billion hit this year from China export controls. Last month, the company said it would incur up to $800 million in costs…
Why it matters here. The export-license requirement was producing comparable consequences at Nvidia, so Nvidia recorded an H20 charge, lost shipments and a further expected hit.
US Export Controls on AMD's AI Chips in China: From the MI250 License to MI308 and MI325X
- 4Nvidia writes down H20Financial
Nvidia takes a US$4.5 billion H20 charge, loses US$2.5 billion in shipments, expects US$8 billion hit next quarter
In first-quarter fiscal 2026 results Nvidia recorded a US$4.5 billion charge for H20 excess inventory and purchase obligations, said it could not ship a further US$2.5 billion of H20 revenue, and guided second-quarter revenue of US$45 billion reflecting about US$8 billion of lost H20 revenue.
Nvidia Newsroom ·
NVIDIA incurred a $4.5 billion charge in the first quarter of fiscal 2026 associated with H20 excess inventory and purchase obligations as the demand for H20 diminished.
Why it matters here. The scale of Nvidia's inventory and shipment losses made a policy reopening consequential, so Nvidia next said the United States had assured it H20 licenses would be granted.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
The China barrier
- 7China questions H20 securityRegulatory
China's cyberspace regulator summons Nvidia over alleged H20 backdoor risks
The Cyberspace Administration of China said it had interviewed Nvidia and asked it to explain security risks from backdoor vulnerabilities in H20 chips sold to China and to submit supporting material. Nvidia said its chips have no backdoors that would allow remote access or control.
The Register ·
In order to maintain the network security and data security of Chinese users, the State Internet Information Office interviewed Nvidia on July 31, 2025, and asked Nvidia to explain the security risks of the backdoor…
Why it matters here. The security inquiry was followed by official letters discouraging H20 use for government and security-related AI work.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- 8H20 use discouragedRegulatory
Chinese authorities discourage use of H20 in government and security-related work
Chinese authorities sent letters to companies discouraging use of Nvidia's H20 for AI work, particularly by firms involved in government or national security-related projects, days after the U.S. cleared the chip for export again.
The Register ·
Chinese authorities have sent letters to several firms discouraging the use of Nvidia's H20 GPUs for AI applications, particularly by those involved in government or national security-related work.
Why it matters here. Restricting H20 use among sensitive buyers constrained demand, so Nvidia subsequently reported no H20 sales to China and assumed none in its outlook.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- 9No China H20 salesFinancial
No H20 sales to China in the quarter; Nvidia assumes none in its outlook
Second-quarter fiscal 2026 results showed no H20 sales to China-based customers, a US$180 million release of previously reserved H20 inventory tied to about US$650 million of sales to a customer outside China, and a third-quarter outlook that assumed no H20 shipments to China.
Nvidia Newsroom ·
There were no H20 sales to China-based customers in the second quarter.
Why it matters here. A quarter with no China H20 sales and an outlook assuming none set the pattern the following quarter confirmed.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- 10H20 sales insignificantFinancial
NVIDIA says H20 sales were insignificant in the third quarter
NVIDIA reported that H20 sales were insignificant in the third quarter of fiscal 2026. The company disclosed the result in its CFO commentary.
NVIDIA CFO Commentary ·
H20 sales were insignificant in the third quarter.
Why it matters here. H20 sales remained insignificant in the third quarter, confirming that the lack of meaningful H20 shipments anticipated in the prior outlook had not become a recovery.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
What pushes back
- 5US promises H20 licenses
Nvidia says the US has assured it H20 licenses will be granted and sales to China will resume
After Jensen Huang met officials in Washington and travelled to Beijing, Nvidia said the U.S. government had assured it that H20 export licenses would be granted and that it hoped to start deliveries soon. It also announced an RTX Pro GPU aimed at the China market.
Nvidia Blog ·
The U.S. government has assured NVIDIA that licenses will be granted, and NVIDIA hopes to start deliveries soon.
What it pushes against. This assurance pushed against a lasting export halt by holding out resumed sales, so Commerce also said it would move forward with AMD's MI308 license applications.
US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- 6MI308 review resumes
Commerce will resume reviewing MI308 licenses; AMD says shipments will restart once approved
The day after Nvidia said it had been assured H20 licenses would be granted, AMD said the Commerce Department would move forward with its MI308 license applications and that it planned to resume shipments as approvals came, praising the administration's trade negotiations. The stock rose more than 6 percent.
CNBC ·
The company said Tuesday that the U.S. Commerce Department plans to resume reviewing its license applications to send the products to the world's second-largest economy. AMD said it plans to start shipments once those…
What it pushes against. The reopened U.S. review path coincided with a separate China-side hurdle, as Chinese authorities summoned Nvidia over alleged H20 backdoor risks.
US Export Controls on AMD's AI Chips in China: From the MI250 License to MI308 and MI325X
Changes to this chain
- Proposal #134 accepted (verify:v4): why of step 10 -> H20 sales remained insignificant in the third quarter, confirming that the lack of meaningful H20 shipments anticipated in the prior outlook had not become a recovery.
- Step 9 why edited by the editor: Bridge instead of restating
- Proposal #106 rejected (publish:amd-china-export-controls)
- Proposal #105 rejected (publish:amd-instinct-ai-gpus)
- Proposal #104 accepted (publish:nvidia-datacenter-gpu-roadmap): insert after 8: [cause] No China H20 sales -> nvidia-china-export-controls#55: With no H20 sales to China-based customers and no China shipments assumed in its outlook, Nvidia next reported that third-quarter H20 sales were insignificant.; answer: The April 2025 licensing requirement turned Nvidia’s H20 and AMD’s MI308 into controlled exports, immediately putting inventory, shipments and expected revenue at risk. Nvidia subsequently recorded a $4.5 billion H20 charge, could not ship $2.5 billion of product, and expected a further $8 billion hit; AMD projected about $1.5 billion less 2025 revenue, including $700 million in the second quarter. U.S. assurances that licenses would be granted and that MI308 applications would again be reviewed offered a route to restart shipments, but they did not restore sales by themselves. Nvidia recorded no H20 sales to China-based customers in the second quarter and assumed no such shipments in its third-quarter outlook. China also raised H20 security concerns and discouraged its use in government- and security-related work, and Nvidia later said H20 sales were insignificant in the third quarter. Companies therefore had to treat a U.S. license as necessary but not sufficient for China revenue.
- Proposal #84 accepted (publish:nvidia-china-export-controls): replace step 9: [cause] H20 sales insignificant -> nvidia-china-export-controls#1335: H20 sales were insignificant in the third quarter, so the chain ends with an actual result rather than the prior outlook.; answer: The April 2025 licensing requirement turned Nvidia’s H20 and AMD’s MI308 into controlled exports, immediately putting inventory, shipments and expected revenue at risk. Nvidia subsequently recorded a $4.5 billion H20 charge, could not ship $2.5 billion of product, and expected a further $8 billion hit; AMD projected about $1.5 billion less 2025 revenue, including $700 million in the second quarter. U.S. assurances that licenses would be granted and that MI308 applications would again be reviewed offered a route to restart shipments, but they did not restore sales by themselves. China then raised H20 security concerns and discouraged its use in government- and security-related work, and Nvidia later said H20 sales were insignificant in the third quarter. Companies therefore had to treat a U.S. license as necessary but not sufficient for China revenue.
Timelines in this chain
- US Export Controls on Nvidia AI Chips to China: A100 to H20 to H200
- US Export Controls on AMD's AI Chips in China: From the MI250 License to MI308 and MI325X
- Nvidia's Dealmaking: From Mellanox and the Failed Arm Bid to Groq and Hugging Face
- Nvidia Data Center GPUs: Hopper, Blackwell and Vera Rubin
- AMD Instinct: From MI300X to Helios and the Gigawatt Deals
A chain is written by the editor from entries already published on the timelines above, each of which was read against its source before publication. The chain changes when those entries do. Data and terms.