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Nvidia’s $5.5B Hit: US Export Ban On AI Chips To China Shakes Global AI Race

Nvidia just took a $5.5 billion punch to the balance sheet—courtesy of the U.S. government’s latest move to tighten the leash on AI chip exports to China. The company’s most advanced processor available in the Chinese market, the H20, has now fallen under indefinite export restrictions, triggering a 6% slide in Nvidia shares in after-hours trading.

The decision, announced Tuesday, marks a major escalation in the U.S.-China tech standoff and underscores Washington’s growing concern over how AI hardware could fuel China’s supercomputing ambitions. The U.S. Commerce Department has now slapped licensing requirements not only on Nvidia’s H20, but also on AMD’s MI308 and similar chips. AMD shares dropped 7% after the news.

A Commerce Department spokesperson said the move reflects President Biden’s directive to safeguard U.S. national and economic security. Nvidia, meanwhile, confirmed the charges would cover unsold H20 inventory, outstanding purchase commitments, and related reserves.

A Workaround, Now Blocked

Nvidia had designed the H20 chip specifically to navigate around previous U.S. export limits—delivering toned-down performance but retaining high-speed interconnectivity. That design made the H20 attractive for AI inference tasks, an increasingly dominant segment of the market where models provide real-time answers rather than undergoing initial training.

Despite not being as powerful as Nvidia’s top-tier chips sold outside China, the H20 gained traction with major Chinese tech players including Tencent, Alibaba, and ByteDance. Reuters previously reported that demand surged after startups like DeepSeek ramped up development of low-cost AI models.

But that very design—optimized for high-bandwidth memory access and chip-to-chip connectivity—set off alarm bells in Washington. Analysts argue it still carries supercomputing potential, especially if deployed at scale.

“Likely In Violation”

A Washington, D.C.-based think tank, the Institute for Progress, didn’t mince words. In a statement Tuesday, it claimed that Tencent had already installed H20 chips in a facility likely used to train large AI models—potentially breaching U.S. export restrictions already in place. The group added that DeepSeek’s infrastructure, used for its latest V3 model, might also be in violation.

U.S. restrictions on chips used in supercomputing have been in effect since 2022. Now, the H20 is joining that list. Nvidia said it was formally notified on April 9 that the chip would require an export license—and on April 14, that the restriction would be indefinite. Whether the U.S. will issue any such licenses remains unclear.

A Fork In The Road

This latest move throws a wrench into Nvidia’s China strategy, just as demand in the region for generative AI tools is accelerating. It also highlights the growing friction between global innovation and geopolitical control—a tension Nvidia CEO Jensen Huang must now navigate carefully.

The setback comes one day after Nvidia unveiled plans to invest up to $500 billion into U.S.-based AI server infrastructure, working with partners like TSMC to align with American industrial policy.

Now, as Nvidia absorbs the financial blow and recalibrates, one thing is clear: the AI chip race isn’t just about performance anymore. It’s a front line in the broader battle over who controls the future of intelligent computing.

Citigroup Raises Eurobank Target Price Following Strong Q1 Results

Revised Target Price Reflects Strengthened Outlook

Citigroup raised its target price for Eurobank to €5.00 from €4.70 while maintaining a buy recommendation following the bank’s first-quarter results and upgraded medium-term profitability outlook. Based on Eurobank’s reference share price of €3.72 on May 15, 2026, Citigroup’s revised target implies upside potential of 34.4%, rising to 38.5% when the estimated dividend yield of 4.1% is included.

Enhanced Earnings And Comprehensive Forecasts

The upgraded analysis from Citigroup, as reported by Newmoney, points to bolstered momentum in net interest income and fee generation. The investment bank has revised its normalized earnings per share forecasts upward: 4% for 2026, 9% for 2027, and 14% for 2028, primarily driven by higher expected net interest income and increased commissions.

Scenario Analysis Offers Range Of Outcomes

Citigroup’s bullish scenario values Eurobank shares at €6.10, implying potential upside of 64%. Its downside scenario projects a share price of €3.55, approximately 4.6% below the May 15 reference level. The optimistic case assumes a return on tangible equity one percentage point higher, alongside a 100 basis point reduction in the cost of equity. Meanwhile, the negative scenario assumes a 1.5 percentage point lower return combined with a 200 basis point increase in the cost of equity.

Solid Q1 Results Support Growth Targets

Eurobank reported normalized net profits of €351 million during the first quarter, broadly in line with market expectations. Reported net profit reached €331 million after a €35 million expense linked to a voluntary exit programme involving around 200 employees. The programme is expected to generate annual savings of approximately €14 million. Net interest income increased 3% quarter-on-quarter, exceeding consensus forecasts by 2% and supporting expectations that the bank could surpass its €2.6 billion target for 2026.

Looking Ahead: Ambitious Growth And Profitable Outlook

Organic loan growth reached €1.1 billion during the quarter, supporting management’s target for €3.8 billion in annual organic credit expansion. Fee income also rose 20% year-on-year, outperforming forecasts by 4%. Citigroup projects Eurobank’s net profit will reach €1.45 billion in 2026, with earnings per share of €0.40 and a dividend of €0.20 per share.

By 2028, the bank forecasts net profit of €1.76 billion alongside further improvement in profitability metrics and dividend yield. The revised projections reinforce expectations that Eurobank will continue benefiting from stronger lending activity, resilient fee income and improving operational efficiency.

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