Nvidia: big demand, China charge

Nvidia’s latest quarter showed that demand for its artificial-intelligence chips stayed high even as new U.S. export rules forced a multibillion-dollar hit tied to China. (investor.nvidia.com) For the quarter ended April 27, 2025, Nvidia reported $44.1 billion in revenue, up 69% from a year earlier, and $39.1 billion from data center customers. The company said first-quarter sales included $4.6 billion of H20 product revenue before the new licensing rules took effect. (nvidianews.nvidia.com) The charge came after the U.S. government told Nvidia on April 9, 2025, that exports of H20 chips to China, Hong Kong, Macau and certain other destinations would require a license. Nvidia said that change led to a $4.5 billion first-quarter charge tied to excess H20 inventory and purchase obligations as demand for that product fell. (sec.gov) Data center is the part of Nvidia’s business that sells chips and networking gear to cloud companies and other large computing operators. In the quarter, that segment accounted for about 89% of total revenue, showing how much Nvidia’s growth now depends on the buildout of systems for training and running artificial-intelligence models. (sec.gov) The China issue did not erase the underlying demand picture in Nvidia’s numbers. In its next quarter, ended July 27, 2025, the company reported revenue of $46.7 billion and data center revenue of $41.1 billion, while also separating out the effect of H20-related charges and releases in its non-GAAP results. (nvidianews.nvidia.com) Nvidia designed H20 as a lower-performance chip for China after earlier U.S. restrictions limited sales of more advanced processors there. The April 2025 rule change tightened those controls again by requiring a license even for H20-class products. (sec.gov) The company later said the first-quarter charge was smaller than it had initially expected because it could reuse some materials. Nvidia also told investors the H20 licensing rules had already hurt current revenue and would weigh on future revenue. (sec.gov; sec.gov) By July 14, 2025, Nvidia said it expected to resume H20 sales to China and announced a new China-compliant graphics processor, after chief executive Jensen Huang met with U.S. officials and visited Beijing. That sequence left the quarter as a clear snapshot of two forces hitting Nvidia at once: heavy global spending on accelerated computing and sudden policy shifts that can rewrite a product market in days. (blogs.nvidia.com)