This episode explores the impact of new US export restrictions on Nvidia's H-20 chips and their sales to China. The news broke with Nvidia's 8K filing, revealing a $5.5 billion charge due to inventory and the requirement of licenses for future sales. Against this backdrop, the host analyzes the short-term financial implications, noting a significant drop in Nvidia's stock price and the potential impact on the upcoming earnings report. More significantly, the discussion delves into the long-term consequences, considering the decreasing percentage of Nvidia's revenue from China in recent years, but also highlighting the potentially significant role of Singapore as a billing location for Chinese companies. For instance, the host examines the possibility that a portion of the Singapore revenue, currently 18% of Nvidia's total, could also be affected by the restrictions. The episode concludes by considering various potential outcomes, ranging from a short-term revenue delay to a more sustained impact, and ultimately emphasizes the long-term strength of Nvidia's position in the AI market despite the geopolitical challenges.
