Impact of New U.S. Licensing Rules on China-Focused GPUs
UBS analysts led by Timothy Arcuri have trimmed their price targets for two leading AI?chip suppliers—Nvidia (NASDAQ: NVDA) and AMD (NASDAQ: AMD)—in response to new U.S. export?licensing requirements that effectively curtail shipments of China?specific GPU models.
Nvidia: $9 Billion Revenue Hit and Margin Pressure
Price Target Revision: Cut to $180 from $185
Revenue Impact: Approximately $9 billion total—~$700 million in fiscal Q1 and ~$8 billion spread across Q2/Q3
Gross Margin Outlook: Non?GAAP margin now seen at 58–59% (versus prior 71%)
UBS attributes the margin hit primarily to the H20 GPU license restriction, adding that higher tariff?related costs and Nvidia’s decision to defer its Cordelia?architecture upgrade (due to Bianca design warpage issues) will further erode profitability.
AMD: Presumed Ban on MI308 and Inventory Charges
Price Target Revision: Cut to $155 from $175
Licensing Impact: MI308 GPUs for China now subject to the same restrictive licensing regime as Nvidia’s H20, carrying a “presumption of denial”
Estimated Charges: Up to $800 million in inventory, purchase commitments, and reserves—translating to roughly $1 billion in revenue loss
UBS warns that the near?total prohibition of AMD’s China?specific GPU shipments will compound the headwinds facing its data?center segment.
Broader Sector Implications
These adjustments underscore how geopolitical policy shifts can rapidly alter the near?term outlook for semiconductor leaders. Investors should watch for similar licensing developments affecting other China?bound chip products and for potential ripple effects on AI?hardware roadmaps.
Tracking Analyst Revisions
To monitor evolving analyst price targets and rating changes for Nvidia, AMD, and other semiconductor names, consider these Financial Modeling Prep APIs:
Price Target Summary APIView the latest consensus price targets and how UBS’s revisions compare to the Wall Street average.Price Target Summary API
Up/Down Grades by Company APITrack real?time analyst upgrades, downgrades, and rating shifts triggered by these licensing announcements.Up/Down Grades by Company API
These APIs provide investors with timely insights into how strategic developments and policy changes are reshaping analyst expectations and stock valuations in the semiconductor sector.
