Nvidia stock (NVDA) fell more than 5% on Tuesday, partially reversing its two-week rally and slipping from a record close the previous day.

The stock’s plunge began before the market opened in response to a Bloomberg report that Biden administration officials were considering limiting U.S. chip exports to certain countries. Bloomberg reports, citing unnamed sources, that possible regulations would focus on the Gulf states in the interests of national security. Shares of fellow chipmakers Advanced Micro Devices (AMD) and Intel (INTC) also fell due to this news.

Intel declined to comment on the report. Nvidia and AMD did not immediately respond to requests for comment from Yahoo Finance.

Adding to chip stocks’ woes on Tuesday was a dismal earnings report from semiconductor equipment maker ASML (ASML). The Dutch company, which sells equipment to chipmakers TSMC and Intel, reported orders worth just 2.6 billion euros ($2.8 billion), far less than the 5, 39 euros forecast.

The PHLX Semiconductor Index (^SOX) fell 4.4% on Tuesday, far underperforming the S&P 500 (^GSPC), which fell 0.5% at midday.

Nvidia’s decline on Tuesday partially reverses a two-week winning streak that led the stock to a new record closing price on Monday and nearly eclipsed Apple (AAPL) as Wall Street’s most valuable company. Shares closed above $138 on Monday, surpassing their previous record of $135.58 in June. Nvidia’s tears were fueled by news of strong demand for its AI chips and renewed optimism about AI.

Nvidia stock has been more volatile since its 10-to-1 stock split in June, and news of heightened trade tensions focused on the AI ​​chip sector – where Nvidia is a leader – has pushed shares lower several times in the past two years . For example, this time last year, Nvidia shares experienced a similar decline as the Biden administration tightened export controls on US chips – before continuing its historic rally.

Despite Tuesday’s decline, Nvidia shares are up 186% year-over-year. While demand for its AI chips is strong in the near term, in addition to geopolitical risks, a possible decline in AI spending by major tech companies is another cause for concern for investors. DA Davidson’s Gil Luria recently told Yahoo Finance that AI spending could decline as early as 2025, which would be bad news for Nvidia stock.

Nvidia is scheduled to report earnings on November 19th. Wall Street analysts expect the company to report revenue of $33 billion, up 82% from a year ago, according to Bloomberg consensus estimates. About 90% of Wall Street analysts covering the stock tracked by Bloomberg recommend buying Nvidia shares.

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Laura Bratton is a reporter for Yahoo Finance. Follow her on X @LauraBratton5.

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