The recent earnings season revealed widespread uncertainty among major global semiconductor firms, driven largely by shifting U.S. tariffs and export controls targeting China. These unpredictable policy changes have made it difficult for chip companies to gauge demand for their products.
Although former U.S. President Donald Trump’s reciprocal tariffs were paused shortly after being introduced in April, the Biden administration has continued restricting the export of specific semiconductor technologies—especially AI-related chips—to China. In the latest round of curbs, products from Nvidia and AMD were added to the list of restricted items.
As a result, major players in the chip industry are feeling the strain. AMD reported that it could lose up to $1.5 billion in revenue by the end of the fiscal year due to the new export rules, despite strong earnings in Q1. Super Micro also issued weaker-than-expected guidance and withheld its forecast for fiscal 2026, citing economic and tariff-related uncertainty. Meanwhile, Marvell postponed its investor day, acknowledging the unclear business landscape. Both Super Micro and Marvell saw their stock prices drop in premarket trading.
Industry experts note that the combination of demand fluctuations, global economic instability, and trade restrictions is creating a highly uncertain environment for chipmakers. While tech giants like Amazon and Microsoft are still heavily investing in AI infrastructure, questions remain about the broader demand outlook for AI chips.
Nvidia CEO Jensen Huang emphasized the importance of competing freely in the global market. He stated that China could represent a $50 billion AI opportunity in the next few years and argued that excluding American companies from this market would be a significant economic loss. Huang called for fewer restrictions and urged U.S. policymakers to allow companies to compete openly with their Chinese counterparts.
According to Huang, “The best way forward isn’t to hold companies back, but to let them innovate and compete. The U.S. needs to fully commit to the race in AI and technology.”
