This segment is small compared to its gaming and data center markets - which generated $2.04 billion and $3.8 billion in Q2 revenue, respectively - but that could change soon. Automotive revenue jumped 45% year over year in Q2 to $220 million. Nvidia is also executing in the automotive industry, providing chips for cars and the artificial intelligence systems of self-driving vehicles. This additional regulation does not completely diminish Nvidia's success in China, but it could cause revenue to remain stagnant. Nvidia no longer sells products in Russia, but China and Hong Kong generated $7.1 billion in fiscal 2022 revenue, representing 26% of total revenue. government imposed an additional license requirement for exports to China, Hong Kong, and Russia for two of Nvidia's integrated circuits. Outside of the company's earnings report, Nvidia is being impacted by export regulations.

'Sales to North America hyperscale and cloud computing customers increased but were more than offset by lower sales to China hyperscale customers affected by domestic economic conditions,' Cress said during the company's recent earnings call. Management noted that as macroeconomic challenges affect consumers, the demand for high-quality gaming GPUs started to fall.Īs the company's chief financial officer Colette Kress explained, China is also putting a dent in its results. The primary driver of the disappointing quarter and the tepid guidance is the declining demand for its gaming graphic processing units (GPUs).

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