[News] AMD Projects a $1.5 billion Sales Hit from Chip Export Curbs, with the Biggest Impact in Q2 and Q3

With Trump’s new export curbs targeting its MI308 AI chips, AMD expects a $1.5 billion revenue hit this year, according to Reuters and CNBC. Meanwhile, CEO Lisa Su noted the impact of the restrictions will land hardest in Q2 and Q3, as per the reports.

The reports suggest that AMD absorbed $800 million in related costs in Q1 and expects another $700 million in lost revenue in Q2. According to Bloomberg, the curbs could lead to a potential revenue hit of $1.5 billion to $1.8 billion, roughly 20% of AMD’s projected AI sales for fiscal 2025.

These costs are believed to stem from unsold inventory, purchase commitments, and related reserves.

Still, AMD remains confident its AI chip revenue from the data center segment will grow by strong double digits. Su acknowledged the headwinds but said the impact is well under control, as noted in the reports.

AMD isn’t the only U.S. chip giant facing tougher curbs on China. On April 9, NVIDIA was informed it needed a license to export its H20 chips, with the restrictions set to last indefinitely by April 14. Intel’s Gaudi series is also affected by these controls.

While NVIDIA will reportedly take a $5.5 billion charge after the U.S. restricted exports of its H20 AI chip to China, yahoo! finance suggests NVIDIA’s writedown hints at a potential $10–16 billion loss in annual revenue.

Strong Q1 and Robust Q2 Despite AI Chip Export Controls

Despite the risks, AMD is forecasting $7.4 billion in Q2 sales with a 43% gross margin, slightly ahead of Wall Street’s estimate of $7.25 billion, according to CNBC.

Notably, AMD achieved record first-quarter results despite grappling regulations on advanced AI chip exports, with revenue rising 36% YoY, as per its press release. Reuters attributes the boost to customers stocking up on chips ahead of upcoming tariffs.

Lisa Su said demand is accelerating as breakthroughs like OpenAI’s 03 and DeepSeek R1 fuel broader customer engagement, according to CNBC.

AMD’s data center segment hit $3.7 billion in Q1 sales, with a strong 57% year-over-year increase. The surge was driven by strong demand for Epyc processors and Instinct GPUs, as noted by CNBC.

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(Photo credit: AMD)