Nvidia’s Q2 Earnings Loom: Brace for $8 Billion China Chip Ban Impact

Nvidia faces a moment of truth as it prepares to report second quarter earnings—with a staggering $8 billion blow from China trade restrictions hanging over the results.

Earnings Under Pressure

The chip giant’s revenue takes a direct hit from tightened export controls, stripping away one of its largest markets virtually overnight. That’s not a slowdown—it’s a full-scale disruption.

Market Reactions & Strategic Shifts

Investors are watching closely to see how management plans to pivot—whether through market diversification, product recalibration, or cost adjustments. One thing’s clear: relying on geopolitical stability is a rookie move in the big leagues.

While Wall Street frets over the next quarter, crypto miners are probably eyeing discounted GPUs—because nothing says 'hedge' like turning gaming hardware into digital gold machines.

Read more Nvidia earnings coverage

Nvidia will report earnings on Wednesday, Aug. 27.

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Baird senior research analyst Tristan Gerra offered a similarly sunny outlook for July quarter EPS and revenue estimates on strong GB200 sales. Wedbush analyst Matt Bryson, meanwhile, raised the firm's price target on Nvidia from $175 to $210 on solid feedback on the company's demand and shipments.

"We continue to believe growth in announced hyperscale spend is largely going to build out AI capabilities and in particular ends up flowing to [Nvidia], which supplies a disproportionate amount of the AI server value," he wrote in a note to investors.

Options traders expect Nvidia's market value to swing about $260 billion after its second quarter earnings, suggesting investors feel more certain about the company's performance.

Nvidia is also preparing a new chip for the Chinese market based on its Blackwell architecture, but the company WOULD need to get Trump's approval to sell it in the region.

The Chinese government has also come out in recent weeks to warn local companies against using Nvidia's chips, saying they could contain "backdoor" security risks.

Nvidia has denied the charge and is working with the Chinese government to address the matter.

Email Daniel Howley at [email protected]. Follow him on X/Twitter at @DanielHowley.