Nvidia Drops China From Guidance After $2.5 Billion Q1 Revenue Hit, CEO Jensen Huang Says He's 'Not Counting' On US Lifting Export Controls, 'But If It Happens, It Will Be A Great Bonus'

Chip giant Nvidia Corporation NVDA has revised its financial strategy after U.S. export controls blocked AI chip sales to China, resulting in a multibillion-dollar revenue shortfall in the first quarter of 2025.

What Happened: Speaking to CNN in Paris on Thursday, Nvidia CEO Jensen Huang said the company will no longer include China in its revenue or profit forecasts due to ongoing U.S. export restrictions.

"I'm not counting on it, but if it happens, then it will be a great bonus," Huang said, referring to the possibility of loosened trade rules. "I've told all our investors and shareholders that, going forward, our forecasts will not include the China market."

Earlier this year, Nvidia was forced to halt shipments of its China-specific H20 AI chips after the U.S. government determined a special license was required.

That decision cost the company $2.5 billion in potential revenue in the first quarter. Although Nvidia expected a $5.5 billion hit from excess inventory, it ultimately recorded a $4.5 billion charge.

"The goals of the export controls are not being achieved," Huang told the publication. "Whatever those goals are that were being discussed initially, (they) are apparently not working. And so I think, with all export controls, the goals have to be well-articulated and tested over time."

Why It's Important: Speaking at the Viva Tech conference in Paris on Thursday, Huang also cautioned that continued U.S. restrictions on AI chip exports to China could allow Huawei Technologies to strengthen its position within China.

On Monday, Kevin Hassett, who heads the U.S. National Economic Council, told CNBC that the Donald Trump administration could consider easing some export limits on microchips deemed essential by China for its manufacturing needs, the report noted.

However, he said that the U.S. will continue to restrict access to "very, very high-end" Nvidia chips designed to support artificial intelligence systems.

Price Action: Nvidia shares have gained 4.84% year-to-date and are up 15.81% over the past 12 months. On Thursday, the stock climbed 1.52%, closing at $145, according to Benzinga Pro.

Benzinga's Edge Stock Rankings show Nvidia maintaining strong upward momentum across short, medium and long-term periods. Further performance details are available here.