Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

<ul>
<li>Apparently, on news of this new Huawei chip in WSJ, Nvidia’s stock decline -2% yesterday. That’s strange – not new news, the real issue is new US export license requirements.</li>
<li>Nvidia’s problem is not Huawei, but US restrictions on selling GPU to China. Nvidia announced writing off US$5.5bn on 9 April 2025 (for H20). AMD estimates US$800m (for MI308).</li>
<li>Assume that Nvidia and AMD will not sell any AI chips to China. Same for HBM memory.</li>
</ul>


Apparently, on news of this new Huawei chip in WSJ, Nvidia’s stock decline -2% yesterday. That’s strange – not new news, the real issue is new US export license requirements.
Nvidia’s problem is not Huawei, but US restrictions on selling GPU to China. Nvidia announced writing off US$5.5bn on 9 April 2025 (for H20). AMD estimates US$800m (for MI308).
Assume that Nvidia and AMD will not sell any AI chips to China. Same for HBM memory.


Is Huawei New AI Chip Is Bad for Nvidia? New US Export Licensing Is the Real Issue (Part 2)

Quantitative Researcher, MRM Research

Nico Rosti

Quantitative Researcher

MRM Research

Quantitative Research

Equity Derivatives

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA</a> stock rose over 3% Wednesday morning, after news of a reported multi-billion-dollar AI chip deal with Saudi Arabia, announced during an investment forum attended by President Trump. </li>
<li>Nvidia will supply hundreds of thousands of AI chips over five years to Humain, a new Saudi AI venture backed by the $925B Public Investment Fund. </li>
<li>Bank of America raised NVDA price target to $160 from $150. A Bloomberg report suggested the UAE may buy over 1 million Nvidia AI chips under a potential U.S. deal. </li>
</ul>



NVIDIA stock rose over 3% Wednesday morning, after news of a reported multi-billion-dollar AI chip deal with Saudi Arabia, announced during an investment forum attended by President Trump. 
Nvidia will supply hundreds of thousands of AI chips over five years to Humain, a new Saudi AI venture backed by the $925B Public Investment Fund. 
Bank of America raised NVDA price target to $160 from $150. A Bloomberg report suggested the UAE may buy over 1 million Nvidia AI chips under a potential U.S. deal. 


Nvidia (NVDA US) Outlook Following $7B AI Chip Deal with Saudi Arabia

<ul>
<li>What did hyperscalers say on Capex in March conf calls? Amazon: nothing. Google: maintained. Meta: increase. Microsoft: maintained. No Capex cuts or postponement. </li>
<li>At the opposite, Amazon and Google mention capacity constraints, revenues could be higher with more capacity. All firms mention that AI is a critical building block of future growth. </li>
<li>Financial statements show 1) improving operating margins, 2) higher capex but still higher free cash flow. Positive for <a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA Corp (NVDA US)</a> and <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">Taiwan Semiconductor (TSMC) (2330 TT)</a> .  </li>
</ul>


What did hyperscalers say on Capex in March conf calls? Amazon: nothing. Google: maintained. Meta: increase. Microsoft: maintained. No Capex cuts or postponement. 
At the opposite, Amazon and Google mention capacity constraints, revenues could be higher with more capacity. All firms mention that AI is a critical building block of future growth. 
Financial statements show 1) improving operating margins, 2) higher capex but still higher free cash flow. Positive for NVIDIA Corp (NVDA US) and Taiwan Semiconductor (TSMC) (2330 TT) .  


Hyperscale Capex Is Maintained or Increased No Cuts or Postponement Capacity Constrain at AMZN GOOG

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nvidia-corp" target="_blank" data-smartkarma-citation="entities:5891:1" rel="noopener">NVIDIA Corp (NVDA US)</a>  said it will take a $5.5 billion financial hit after Washington fresh restrictions on H20 AI chips designed for the Chinese market. </li>
<li>The Trump Administration's move comes as as a surprise, the U.S. now requires a special export license for these chips, but historically, no such licenses have ever been granted.</li>
<li>Some estimates Nvidia may lose $10 billion in revenue, as most of the affected chips are already manufactured and now unsellable, plus the ban could benefit Chinese competitors like Huawei.</li>
</ul>



NVIDIA Corp (NVDA US)  said it will take a $5.5 billion financial hit after Washington fresh restrictions on H20 AI chips designed for the Chinese market. 
The Trump Administration's move comes as as a surprise, the U.S. now requires a special export license for these chips, but historically, no such licenses have ever been granted.
Some estimates Nvidia may lose $10 billion in revenue, as most of the affected chips are already manufactured and now unsellable, plus the ban could benefit Chinese competitors like Huawei.


Nvidia (NVDA US) Outlook Following Surprise $5B Hit From China Chip Export Ban

Asia and Global Semiconductor and Tech Research

Andrew Lu

<ul>
<li>Nvidia reports/guides a better than expected 3Q/4Q23 sales, margin, and EPS on stronger AI GPU sales growth of nearly 3x.</li>
<li>Nvidia reports a healthy 3.04 MOI, down 5% q/q and down 37% y/y and contributes nicely to account for 9% of TSMC sales.</li>
<li>In spite of concerns on good news priced in, seasonal weaker 1Q24, and MI300X/ASIC alternative AI solutions, we expect more raise to come in 2024-2025E.</li>
</ul>


Nvidia reports/guides a better than expected 3Q/4Q23 sales, margin, and EPS on stronger AI GPU sales growth of nearly 3x.
Nvidia reports a healthy 3.04 MOI, down 5% q/q and down 37% y/y and contributes nicely to account for 9% of TSMC sales.
In spite of concerns on good news priced in, seasonal weaker 1Q24, and MI300X/ASIC alternative AI solutions, we expect more raise to come in 2024-2025E.


As Expected from Our Earlier BOM/CoWoS Analysis, Consensus to Raise Nvidia Estimates Inevitably

United States

NVIDIA Corporation designs, develops, and markets three dimensional (3D) graphics processors and related software.  The Company's products provide interactive 3D graphics to the mainstream personal computer market.

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NVIDIA Corp (NVDA US)

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52-week Range

Market Cap (USDm)

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Is Huawei New AI Chip Is Bad for Nvidia? New US Export Licensing Is the Real Issue (Part 2)

​News of Huawei chip impacts Nvidia stock, but real issue is US export restrictions on selling GPUs to China. Nvidia and AMD facing significant...

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​Hyperscalers maintain or increase Capex, mention capacity constraints. Financial statements show improving margins, higher capex and higher free...

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​NVIDIA Corp faces a $5.5 billion hit due to US restrictions on its H20 AI chips for China, currently selling off and looking for a bottom in the...

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Hyperscalers maintain or increase Capex, mention capacity constraints. Financial statements show improving margins, higher capex and higher free...

NVIDIA Corp faces a $5.5 billion hit due to US restrictions on its H20 AI chips for China, currently selling off and looking for a bottom in the...