Nvidia CEO Jensen Huang delivers the keynote for the Nvidia GPU Technology Conference at the SAP Center in San Jose, California, on March 18, 2025.
Brittany Hosea-small | Reuters
Technology stocks dropped Wednesday, led by a 7% plunge in Nvidia, as the chipmaking sector signaled that President Donald Trump’s sweeping tariff plans could hamper semiconductor demand.
Nvidia revealed in a filing Tuesday that it take a $5.5 billion charge in the first quarter tied to exporting its H20 graphics processing units to China and other countries.The government will also require a license to ship the chips there and other destinations, the company said.
The Nvidia chip was designed specifically for China use to meet U.S. export restrictions barring the sale of advanced artificial intelligence processors during former President Joe Biden’s administration. The chips totaled an estimated $12 billion to $15 billion in revenue last year. Advanced Micro Devices echoed similar concerns, saying in a filing Wednesday that it expects a $800 million hit from curbs on its MI308 products.
The disclosures from Nvidia and AMD serve as the first major warning signs that Trump’s fierce battle with China could stifle growth for the critical components utilized in the world’s largest tech innovations. The administration has made some exemptions for electronics, including semiconductors, but has warned that separate tariffs could come in the future.
Adding to the sour sentiment was a disappointing print from Dutch semiconductor equipment maker ASML. The company missed order expectations and said tariff restrictions create demand uncertainty, pushing shares down 7%. Equipment makers Applied Materials and Lam Research fell about 5% in sympathy.
Chipmaking stocks fell across the sector, with the VanEck Semiconductor ETF declining more than 4%. AMD plummeted about 7%, while Micron Technology, Marvell Technology and Broadcom slipped more than 2% each.
The declines spilled over into the broader market and tech-heavy Nasdaq Composite, which dropped more than 3%. Meta Platforms, Apple, Amazon, Microsoft declined around 3% each, while Tesla fell 5%. Alphabet lost more than 2%.
Nvidia and AMD shares over the last month
Tech volatility
Investors had hoped President Trump’s new term in office would usher in a period of strength for the technology sector. That hope helped power the market to new highs in the post-election market rally and sent top tech executives flocking Washington to show their support on Inauguration Day.
But technology stocks have recorded significant market cap losses since the January, whipsawing in the wake of Trump’s tariff announcements as global trade war fears and recession concerns mounted. Year to date, Nvidia, Apple, and Amazon have lost about a fifth of their value, while Tesla is down more than 40%.
The ongoing tariff uncertainty and swift changes in policy have created a volatile stretch for global markets. Stocks initially fell on the news, leading the the “Magnificent Seven” stocks to shed more than $1.8 trillion in market value over two trading days. The turbulence continued as Trump later announced a 90-day pause on most reciprocal tariffs, sending the Nasdaq Composite to its second-best session ever last week.
While technology stocks have bounced from their lows, megacaps sit off their highs this month. Apple and Meta Platforms are down more than 12% each in April, while Amazon and Tesla have slumped more than 8%. Nvidia is down about 7%.
WATCH: Chip stocks fall as Nvidia, AMD warn of higher costs from China export controls
