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Nvidia CEO says tariffs won't raise GPU prices, but does anyone actually believe that?

Nvidia CEO says tariffs won't raise GPU prices, but does anyone actually believe that?

  • 21.03.2025 08:59
  • msn.com
  • Keywords: tariffs, China

Nvidia CEO Jensen Huang claims tariffs won't significantly affect GPU prices, though retailers are already hiking prices due to them. While Huang expresses optimism about U.S. manufacturing, economic challenges and supply issues may delay any price relief.

Nvidia ProductsNVDAsentiment_dissatisfied

Estimated market influence

Nvidia

Nvidia

Negativesentiment_dissatisfied
Analyst rating: Strong buy

Tariffs impact GPU prices; CEO downplays effect.

TSMC

Positivesentiment_satisfied
Analyst rating: N/A

Working with Nvidia to manufacture in the U.S.

Foxconn

Positivesentiment_satisfied
Analyst rating: N/A

Working with Nvidia to manufacture in the U.S.

Asus

Negativesentiment_dissatisfied
Analyst rating: N/A

Blames price hikes on tariffs; considering moving manufacturing.

Context

Analysis of Business Insights and Market Implications

Key Facts and Data Points

  • Nvidia's CEO Jensen Huang downplayed the impact of U.S. tariffs on China, despite Nvidia having a significant manufacturing presence there.
  • The U.S. government imposed 25% tariffs on electronic goods imported from China in February 2017, including graphics cards (GPUs).
  • Retailers like Newegg and Best Buy have already blamed price hikes on Nvidia GPUs on these tariffs.
  • Companies are considering shifting manufacturing to the U.S. to avoid tariffs, with Nvidia working with TSMC and Foxconn for this purpose.

Market Trends and Business Impact

  • The GPU market is currently experiencing price hikes, driven by scalping and supply chain issues, in addition to potential tariff impacts.
  • Long-term manufacturing shift: Huang emphasized plans to scale production in the U.S., though this could take years to materialize.
  • Tariffs are expected to add to cost pressures, potentially leading to further price increases for consumers.

Competitive Dynamics and Strategic Considerations

  • Competitors like AMD may benefit if Nvidia's costs rise or supply chain disruptions occur.
  • Shifting manufacturing to the U.S. is a strategic move to avoid tariffs but could face challenges such as higher operational costs and longer lead times.

Long-term Effects and Regulatory Impacts

  • The ongoing trade war between the U.S. and China poses uncertainty for global tech companies reliant on Chinese manufacturing.
  • Tariffs may force companies to reevaluate their supply chain strategies, potentially leading to a more diversified production base globally.

Conclusion

The current tariff environment creates immediate challenges for Nvidia's GPU pricing but also highlights long-term strategic opportunities for reshaping its manufacturing footprint. While Huang remains optimistic about U.S.-based production, the near-term impact on consumer prices and competitive dynamics remains uncertain.