What does a few billion dollars in unclaimed revenue mean to a company worth a few trillion dollars?
Not much, it seems.
Nvidia noted during its fiscal first quarter 2026 earnings call that export controls keeping it from selling its Hopper-based H20 chip in China forced it to leave about $2.5 billion in revenue on the table during the quarter. The new rules resulted in a $4.5 billion writedown for the quarter, but that figure was somewhat of a pleasant surprise, as Nvidia had said a month ago that it was expecting a $5.5 billion writedown. Still, export controls will have Nvidia dealing with more lost revenue in the months to come. The company said that for the fiscal second quarter 2026, it is expecting about $45 billion in overall revenue, plus or minus 2%, a figure which it said reflects a total loss in H20 revenue of approximately $8 billion.
Yet, there was plenty of revenue not left on the table during fiscal Q1, as Nvidia reported $44.1 billion in total revenue for the period, beating estimates by roughly a billion dollars. The fiscal Q126 figure was 69% higher than the same quarter last year, and 12% higher than the previous quarter. The most recent reporting period was also the eighth straight quarter that Nvidia has beaten revenue expectations. The bulk of that revenue of course came from the company’s Data Center segment, which accounted for $39.1 billion in revenue, 73% more than the same quarter a year ago, as AI chip demand continued unabated.
The strong growth in revenue despite the lost opportunity in China is perhaps why Wall Street shrugged its shoulders at the missed income and the multi-billion-dollar writedown. Nvidia’s stock soared in after-hours trading Wednesday after the company reported earnings, and opened strong Thursday, priced at above $142 by mid-morning Thursday, more than $7 higher than the previous day’s closing mark.
Nvidia CEO Jensen Huang, in remarks during the quarterly earnings call, also did not seem overly concerned about the lost Q1 dollars, but much more concerned about what he described as a weakened position in the global AI infrastructure market for US suppliers if they are not allowed to compete in China.
He said, according to the Insider Monkey earnings call transcript, “On export control, China is one of the world’s largest AI markets and a springboard to global success. With half of the world’s AI researchers based there, the platform that wins China is positioned to lead globally. Today, however, the $50 billion China market is effectively closed to US industry. The H20 export ban ended our Hopper data center business in China.”
Huang explained that the H20, already reconfigured to meet the requirements of earlier export controls, can’t be further altered to meet the latest export controls. Although, he suggested that Nvidia continues to explore its options.
He added, “China’s AI moves on with or without US chips. It has to compute to train and deploy advanced models. The question is not whether China will have AI, it already does. The question is whether one of the world’s largest AI markets will run on American platforms. Shielding Chinese chipmakers from US competition only strengthens them abroad and weakens America’s position. Export restrictions have spurred China’s innovation and scale. The AI race is not just about chips. It’s about which stack the world runs on. As that stack grows to include 6G and quantum, US global infrastructure leadership is at stake. The US has based its policy on the assumption that China cannot make AI chips. That assumption was always questionable and now it’s clearly wrong. China has enormous manufacturing capability.”
While Huang’s strong commentary was aimed directly at the Trump administration’s move to require American firms to obtain new “export licenses” to operate in China, Huang also played the game that most CEOs are playing now, following his criticism with a tribute to the administration’s rescinding of the Biden administration AI diffusion policy that would have limited AI growth elsewhere.
“President Trump wants America to win,” Huang said. “And he also realizes that we’re not the only country in the race… and recognizes that we have to get the American stack out to the world, and have the world build on top of American stacks instead of alternatives.”