Nvidia’s 2025 has been anything but easy. And it’s going to get tougher.

It’s been a difficult 2025 for Nvidia (NVDA) so far. The company, which had a blockbuster 2024, is beset by challenges that have sent its stock price plummeting. Its most recent setback came Tuesday when it disclosed that the Trump administration will require the company to obtain export licenses to sell its H20 chips to customers in China, effectively banning sales to the country.

The announcement means Nvidia will also book a $5.5 billion charge in the first quarter related to H20 products and purchase commitments. The announcement comes as President Trump is expected to enact tariffs on semiconductors imported from overseas.

The move will also include tariffs on devices like laptops and desktops, which will also impact Nvidia’s consumer and enterprise gaming and graphics chip sales.

Add to that the upcoming AI diffusion export controls that will go into effect in May, which require certain countries to acquire special licenses to gain access to a limited number of AI chips, and Nvidia is clearly battling some powerful headwinds.

And it’s showing up in its stock price. Shares of Nvidia were down 24% year to date as of late Thursday, and more than 6% over the last five days alone.

But there are some bright spots for the company. Its Blackwell chips continue to sell well, and demand will remain strong as tech companies continue to construct data centers to power their AI platforms. But that hasn’t been enough to calm investors’ concerns.

The Trump administration’s export controls on H20 chips to China follow DeepSeek’s revelations that it trained its powerful AI models using below top-of-the-line Nvidia chips. The news set off alarms in Washington, which fears that China could use the technologies to strengthen its position in the global AI race and give its military an edge over that of the US.

Now Nvidia will have to absorb the cost of H20s initially destined for China. That will not only hit Nvidia’s bottom line for Q1, but the year ahead as well. China is Nvidia’s fourth-largest market, accounting for $17.1 billion in sales in the company’s fiscal 2025. The US is its largest market at $61.2 billion, followed by Singapore ($23.6 billion) and Taiwan ($20.5 billion).

It’s worth noting that Nvidia says Singapore accounts for 18% of sales because customers use it to “centralize invoicing” and that its products are almost always shipped to other locations. Singapore itself made up just 2% of sales.

According to BofA’s Vivek Arya, the H20 restrictions could result in a 5% to 8% cut to Nvidia’s fiscal 2026 sales and a 6% to 10% impact on its earnings per share.