NVIDIA (NVDA) picked up a new China headache on Friday, October 16, though not one that touches its guidance. Taiwan plans to add AI servers and advanced semiconductors to its export control list, and shipping them to China without a license would become a crime under the island’s Foreign Trade Act, Bloomberg reported, citing an interview with Taiwan’s economy minister.
Taiwan tied the move to commitments in this year’s trade deal with Washington. No start date has been set.
Why Taiwan Needs the Law
Right now, an unlicensed AI chip shipment to China isn’t a crime in Taiwan on its own. That gap showed up in August, when prosecutors indicted nine people over 74 Nvidia B300 servers that allegedly reached Chinese buyers. They had to rely on breach of trust and document forgery charges. Two people from Super Micro Computer (SMCI)’s Taiwan unit were among them (the company wasn’t charged).
In the US, prosecutors charged Super Micro co-founder Wally Liaw in March over about $2.5 billion of Nvidia servers allegedly routed to China.
Nvidia’s China Line Was Already Shrinking
China (including Hong Kong) revenue fell from $5.53 billion in the January 2025 quarter to $2.77 billion by July 2025, about 6% of the total.
Singapore is the line worth a second look. It hit $10.16 billion in the July 2025 quarter, about 22% of revenue and up 151% in five quarters, while total revenue rose 79%. Those figures were based on customer billing addresses, though. Starting with the October 2025 quarter, Nvidia switched to customer headquarters and recast prior periods. That means Singapore’s disappearance and the apparent 67% jump in US revenue compare two different bases. Like for like, China revenue fell 63% from a year earlier to $2.97 billion, while US revenue roughly doubled to $39.18 billion.
Today, Nvidia’s outlook assumes no China data center compute revenue at all, and H200 sales to China were under 1% of data center revenue last quarter.
Nvidia Stock Already Prices a Lot of This
Nvidia stock trades at about 18x forward earnings, near the 17.5x low on TIKR’s chart since late 2023 and about 41% below the 30x average.
That discount reflects more than China (this week’s CoreWeave debt scare hit every AI name). Still, a law aimed at gray-market shipments doesn’t ask investors to write off revenue Nvidia already left out of its guidance.
Who Feels Taiwan’s Chip Law More Than Nvidia
Super Micro faces the most visible compliance scrutiny, given the cases involving people tied to the company (it wasn’t charged in either one, and neither was Nvidia, though prosecutors allege an Nvidia distribution manager in Taiwan cleared the sale). Revenue reached $39.06 billion over the last four quarters, up 78% from $21.98 billion the four before, so there’s far more volume moving through its channel to police.
Taiwan Semiconductor (TSM) already follows US rules on advanced chips, so its direct hit is compliance work. AMD (AMD) gets covered too, since its top AI chips face the same US limits.
For Nvidia, Taiwan is closing a door the company’s guidance already treats as shut. Once the rules take effect, unlicensed exporters will face criminal charges for the first time. That makes compliance at assemblers and distributors, Super Micro included, the thing to watch. Taiwan still hasn’t set a start date.
Want to see how Nvidia’s revenue mix by country has shifted, or how its multiple compares with Super Micro’s? Pull up the same charts on TIKR for free. Learn more here.
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