Chipmaking giants Nvidia and AMD have seen their share prices slide

Nvidia and AMD have seen their share prices slide in after-hours trading after Nvidia said US restrictions on artificial intelligence chips to China

Nvidia (NVDA) has disclosed that it anticipates substantial charges of approximately $5.5 billion related to its artificial intelligence (AI) chip inventory due to major U.S. export restrictions impacting the company's operations in China.

This announcement comes in a recent filing with the Securities and Exchange Commission (SEC) ahead of its upcoming first-quarter earnings report for fiscal year 2024.

Nvidia's stock slid by 6% in after-hours trading, extending its year-to-date decline.

According to a report by The Block, the Biden administration has imposed restrictions on Nvidia's H20 integrated circuit and any chips with comparable bandwidth capacity, requiring export licenses.

The restrictions, which also include Hong Kong and Macau, are being implemented to address the risk of the covered products being used or diverted for supercomputers in China.

The H20 chip, which is currently the most advanced AI chip Nvidia can sell to China under existing export rules, has been a subject of discussion among government officials.

Earlier this month, President Donald Trump met with Nvidia CEO Jensen Huang at Mar-a-Lago to discuss the administration's decision to pause new restrictions on U.S. chip exports to China.

The Trump administration is planning to impose direct investment restrictions on U.S. companies making advanced semiconductors in China and limit exports of some types of chips used in AI applications.

Earlier this week, Nvidia announced its intention to invest several hundred million dollars over the next four years to manufacture some of its advanced AI chips in the U.S.

Nvidia's first quarter of fiscal year 2026 ends on April 27.

Its stock price slid by 6% in after-hours trading, extending its year-to-day decline. Nvidia's share price has slumped by 22% so far this year.