A prime Nvidia government stated President Trump’s potential tariffs and export controls on its highly effective pc chips stay an “unknown” — sending its inventory sliding regardless of better-than-expected quarterly income.
Nvidia shares had been off greater than 4% Thursday morning as investor digested a combined outlook from CEO Jensen Huang’s agency in its fourth quarter earnings report.
Wall Road stays anxious about macroeconomic components as Trump ramps up the strain on China. Nvidia CFO Colleen Kress acknowledged the uncertainty throughout a name with analysts.
“Tariffs, at this point, it’s a little bit of an unknown,” Kress stated. “It’s an unknown until we understand further what the US government’s plan is, both its timing, it’s ‘where’ and how much. So, at this time, we are awaiting, but again, we would, of course, always follow export controls and/or tariffs in that manner.”
Whereas earnings and income got here in above expectations, skeptics pointed to a slight downtick in margins as Nvidia ramps up manufacturing of its new Blackwell AI chips. Income surged 78% to $39.33 billion, however development has slowed barely from its torrid tempo as Nvidia grows bigger.
Nvidia projected gross sales of $43 billion within the present quarter – a quantity which got here in greater than consensus estimates however however appeared to rattle some analysts. Edward Jones analyst Logan Purk described the steering as “slightly underwhelming.”
In a Thursday morning submit on Reality Social, Trump stated he would impose one other 10% tariff on China – along with the ten% tariff it already faces on imports. Tariffs in opposition to Mexico and Canada will take impact on March 4.
Including to the uncertainty, the president beforehand floated a possible “25% and higher” tariff on pc chips.
Nvidia fell alongside the tech-heavy Nasdaq Composite Index, which was down about 200 factors or 1% in early buying and selling.
Nvidia is the main provider of cutting-edge AI chips, with Microsoft-backed OpenAI and Elon Musk’s xAI amongst its shoppers.
Wedbush analyst Dan Ives stated Nvidia’s outcomes recommend the “AI revolution thesis” stays “rock solid” regardless of the market jitters. He reiterated a view that Nvidia will hit a $4 trillion market cap this yr.
“Are there worries about Trump tariffs, export controls, and other macro factors? Of course there are,” Ives stated in a notice to shoppers.
“But our view is ultimately the bark will be worse than the bite with China tariffs/export controls and this is all a game of high stakes poker to drive a deal with China at the negotiating table sometime in 2025,” Ives added.
Huang instructed analysts that demand for the Blackwell chips is “extraordinary” and predicted large issues forward for AI growth.
“We are just at the start of the age of AI…We will grow strongly in 2025,” he stated.
High Trump administration officers have advised the nation may tighten export controls restrict China’s entry to Nvidia finest chips, that are required to coach and energy superior AI chatbots.
Commerce Secretary Howard Lutnick singled out Nvidia’s function in China’s speedy development in AI throughout his affirmation listening to final month – shortly after Chinese language agency DeepSeek unended the tech sector by claiming it had developed a strong mannequin for lower than $6 million.
“Nvidia’s chips, which they bought tons of, and they found their ways around, drive their DeepSeek model. It’s got to end,” Lutnick stated.
