Microchip Maker Nvidia said it would be affected with $ 5.5 billion (4.2 billion pounds sterling) in cost after the US government has tightened the export rules to China.
The flea manufacturing giant, which has been at the heart of the boom in artificial intelligence (AI), will require licenses to export its AI H20 flea to China, which was one of its most popular.
The rules are involved in the midst of an increasing trade war between the United States and China, the two countries introducing commercial prices raised on each other covering various goods.
Nvidia’s shares plunged almost 6% in the trade after opening hours.
Nvidia announced on Tuesday that the US government said it last week that the H20 chip needed a license to be sold to China, including Hong Kong.
The technology giant said that federal officials have advised them the license requirement “will be in force for the indefinite future”.
“The (government) said that the license requirement meets the risk that covered products can be used or diverted to a supercaluler in China,” said Nvidia.
The company refused to comment more when contacted by the BBC.
NVIDIA AI fleas were a key goal of American export controls. Founded in 1993, it was originally known to manufacture the type of computer flea which treats graphics, especially for computer games.
Long before the AI revolution, it began to add features to its chips that indicate aid to automatic learning. It is now considered a key company to monitor to see how fast the technology powered by AI is spreading into the business world.
The value of the company took a safe hit in January when it was reported that a rival application of Chinese AI, Deepseek, had been built on a fraction of the cost of other chatbots.
At the time, the United States was considered to be caught by the technological realization of its rival.
NIVIDA said its fees of $ 5.5 billion would be associated with H20 products for stocks, purchase commitments and related reserves.
