Nvidia’s stock took a sharp hit, falling nearly 3% as the Trump administration moved to tighten semiconductor export controls to China.
On Tuesday, Nvidia’s shares dropped 2.80% on the New York Stock Exchange, closing at $126.63. This decline reduced the company’s market value to $310.1 billion.
Bloomberg reported that the Trump administration had implemented stricter semiconductor sanctions than those introduced by the Biden administration.
The crackdown is occurring on two fronts. First, the U.S. is rallying its allies to block countries like the Netherlands from selling semiconductor equipment to China.
Second, the administration plans to impose further restrictions on the export of Nvidia’s artificial intelligence (AI) chips to China. Notably, Trump’s team intends to tighten limits on the types and quantities of Nvidia semiconductors that can be shipped to China without government approval.
China reportedly accounts for over 20% of Nvidia’s total revenue, highlighting the potential impact of these measures.
The intensified export controls could significantly affect Nvidia’s bottom line.
The looming threat seems to have triggered the nearly 3% drop in Nvidia’s stock. Over the past five trading days, Nvidia’s shares have fallen 9%, and over the last month, they’ve declined 11%, reflecting growing investor concerns about the company’s future in the Chinese market.