Big technology company Nvidia has to deal with unexpected new rules from the U.S. about sending its H20 chips to other countries.

On Tuesday, Nvidia announced that the U.S. government told them they must get a license to sell their H20 AI chips to China. They said this license is needed forever because the U.S. government is worried the chips could be used in a powerful supercomputer in China.

Nvidia expects to have costs of $5.5 billion for this in the first quarter of its financial year 2026, which finishes on April 27. The company's stock price dropped by about 6% after the stock market closed.

The H20 is the most advanced AI chip Nvidia can sell to China under the current and past U.S. export rules. Last week, NPR reported that CEO Jensen Huang might have prevented new rules on the H20. This might be because Nvidia promised to invest in AI data centers in the U.S.

Maybe not by chance, Nvidia announced on Monday that it will spend hundreds of millions of dollars in the next four years to make some AI chips in the U.S. Experts quickly said that the company did not give many details about its plan.

Several government officials wanted stricter rules for sending the H20 chip to other countries. They thought a Chinese AI company called DeepSeek used the chip to train their AI models, including the R1 model. This R1 model surprised the U.S. AI market in January.

Nvidia opted not to provide a statement.