AMD and Nvidia take a hit as US imposes new export restrictions on China

New export licensing requirements are set to cost US chipmakers billions

The US government has tightened its export rules, imposing new licensing requirements on Nvidia H20 and AMD MI308 product shipments to China. Collectively, these restrictions may cost AMD and Nvidia $800 million and $5.5 billion, respectively.

The Commerce Department is committed to acting on the President’s directive to safeguard our national and economic security

– US Commerce Department Spokesperson

These new rules come as the U.S.-China trade war continues to intensify. Following the announcement, Nvidia’s share price fell by 6.5%. AMD has confirmed that they will apply for export licenses, but “there is no assurance that licenses will be granted.”

These new restrictions will make it harder for Chinese companies to acquire chips for their AI projects. While this move is intended to harm Chinese companies within the AI market and prevent Western GPUs from being used for military applications, it has been proven that Chinese companies are more than capable of acquiring sanctioned hardware. Using things like the “Singapore Loophole“, Chinese companies have been able to import sanctioned products through 3rd countries.

Moving forward, we expect Chinese companies to work around the US export restrictions more aggressively. One way or another, AMD/Nvidia AI accelerators will enter China. That said, these new restrictions are still set to hit AMD and Nvidia hard.

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