Nvidia said it expects to take a $5.5 billion hit as President Trump clamps down on the sale of powerful artificial intelligence chips to China.

The US chip designer at the centre of the AI boom said the US government was introducing new restrictions on its chip exports over fears they could be used to help China build a supercomputer.

Supercomputers are the engines of a type of data centre created for the sole purpose of powering AI.

The US had already imposed export restrictions on more powerful Nvidia chips, including the Blackwell, to prevent them reaching China where they could be used for military applications and breakthroughs in AI.

However, Nvidia said the US government will now require licences for exports to China of its H20 chip, the most advanced Nvidia chip presently available in China.

Nvidia announced the $5.5 billion charge in a regulatory filing on Tuesday, sending shares in the company down almost 6 per cent in after-hours trading.

The latest government crackdown on chip exports comes after Chinese companies reportedly placed at least $16 billion in orders for Nvidia’s H20 chips in the first three months of the year.

ByteDance, Alibaba Group and Tencent Holdings are among companies that have been buying up the most advanced Nvidia artificial intelligence chips that are legally available in China under US export controls, The Information reported earlier this month.

The high demand for Nvidia’s H20 chips is believed to be driven by the Chinese start-up DeepSeek’s AI models.

Nvidia said the US government informed it on April 9 that the H20 chip would require a licence to be exported to China and on April 14 told Nvidia that those rules would be in place indefinitely.

Nvidia’s filing did not indicate how many of those licences the US government could grant.

The chipmaker said on Monday that it was planning to spend as much as $500 billion building supercomputers for artificial intelligence entirely in the US over the next four years.