Nvidia Excludes China From Revenue Forecasts as U.S. Export Restrictions Tighten
Nvidia will no longer include China in its revenue and profit forecasts due to ongoing U.S. export controls on advanced chip sales to the region, CEO Jensen Huang confirmed during a CNN interview on Thursday. The move signals a major shift in strategy as Nvidia adapts to geopolitical tensions and stricter trade compliance.
Huang noted that while a potential easing of export curbs could occur following U.S.-China trade talks in London, the company is not relying on that outcome.
“If it happens, then it will be a great bonus. But we’re not counting on it,” Huang said.
U.S. Export Controls Hit Nvidia’s China Revenue Hard
The U.S. government’s export restrictions, aimed at curbing China’s access to high-end AI chips, have already dealt a significant blow to Nvidia:
- $2.5 billion in lost sales in Q1 2025
- $8 billion projected hit in Q2 2025
- 12.5% of Nvidia’s revenue previously came from China
- $4.6 billion in Q1 sales from H2O chips before curbs took effect
The H20 chip, which was tailored specifically for the Chinese market to comply with earlier export restrictions, is no longer permitted for sale under the latest U.S. rules.
China Removed from Forecast Models
Nvidia’s decision to “zero-base” China in its financial outlook is a bid to reduce volatility and increase forecast reliability amid regulatory uncertainty.
“By zero-basing China, Nvidia removes a volatile variable that neither Wall Street nor the Commerce Department can reliably handicap,” said Michael Ashley Schulman, CIO at Running Point Capital.
Still, any revenue from China going forward would be considered a positive surprise rather than an expected baseline.
Limited Options for Reentry Into China
Nvidia is currently evaluating new product designs that might comply with U.S. restrictions, but the $50 billion Chinese data centre market remains largely inaccessible until further notice.
“Until we settle on a new product design and receive approval from the U.S. government, we are effectively foreclosed from China,” Nvidia said in a statement.
This decision could have long-term implications for Nvidia’s performance, especially into 2026, according to analysts.
Industry Impact and Expert Analysis
- Gil Luria, an analyst at D.A. Davidson, warned that without a return to China, Nvidia may face downside risk in 2026.
- Jensen Huang criticised the U.S. export policies, noting that their intended objectives are not being met.
- Nvidia’s China exclusion reflects growing industry adaptation to geopolitical and regulatory challenges in the semiconductor space.
