AMD Warns of $1.5 Billion Revenue Hit from U.S. China Chip Export Curbs, But AI Demand Remains Strong

Advanced Micro Devices (AMD) warned on Tuesday that new U.S. restrictions on AI chip exports to China will cost the company $1.5 billion in revenue for 2025, as Washington intensifies efforts to limit China’s access to advanced technology. Despite the projected hit, AMD’s second-quarter revenue forecast surpassed Wall Street expectations, buoyed by early chip purchases from customers bracing for trade disruptions.

The Biden and Trump administrations have both ramped up controls on exports of high-performance chips to China, citing national security risks related to AI capabilities. These measures now require chipmakers like AMD and Nvidia to obtain export licenses, effectively slowing or blocking shipments of advanced processors.

CEO Lisa Su said most of the export-related impact will be felt in Q2 and Q3, but expressed confidence in broader business strength. “It’s certainly a headwind, but one which we think is well contained,” Su said, noting that AI chip revenue in AMD’s data center segment is expected to grow by “strong double digits” this year.

China represents about 25% of AMD’s total revenue, and the export curbs are expected to shave nearly 5% off 2025 revenue projections, which currently sit at $31.03 billion, per LSEG data.

In Q1, AMD reported:

• Total revenue of $7.44 billion, up 36% year-over-year, beating the estimate of $7.25 billion

• Adjusted earnings of 96 cents per share, 2 cents above consensus

• Data center revenue surged 57% to $3.7 billion, above the $3.62 billion estimate

For Q2, AMD expects revenue of $7.4 billion ± $300 million, also ahead of forecasts. However, the company is still absorbing an $800 million charge due to April’s newly enacted tariffs.

CFO Jean Hu confirmed the $1.5 billion forecasted revenue loss is tied directly to the latest April export controls. Analysts suggest the current surge in orders reflects “pre-buying behavior” from large cloud clients like Microsoft and Meta, who are stockpiling chips ahead of licensing uncertainty.

“Once those safety-stock closets are full, Q3 could feel like the morning after a Red Bull binge,”
warned Michael Schulman, CIO at Running Point Capital.

Meanwhile, rivals Marvell Technology and Super Micro both disappointed investors, citing economic uncertainty and reduced AI-related optimism. Their shares fell 4.5% and 5%, respectively, in after-hours trading.

AMD’s solid results highlight its growing role in powering AI infrastructure for hyperscalers, even as trade tensions and tariffs loom over the semiconductor industry.