WSJ: US Contemplating Imposing Fresh Regulations on Exporting AI Chips to China

Flags of China and U.S. are displayed on a printed circuit board with semiconductor chips, in this illustration picture taken February 17, 2023. REUTERS/Florence Lo/Illustration/File photo

The United States is reportedly considering implementing stricter export regulations on artificial intelligence chips to China, according to sources familiar with the matter cited by the Wall Street Journal.

Following the news, shares of Nvidia dropped over 2 percent, while Advanced Micro Devices (AMD) fell about 1.5 percent in after-hours trading.

The report stated that the U.S. Commerce Department plans to halt shipments of chips produced by Nvidia and other chip companies to customers in China as early as July.

Popular U.S. chipmakers such as Nvidia, Micron, and AMD have found themselves caught in the escalating trade tensions between China and the Biden administration.

In September, Nvidia announced that it had been asked by U.S. officials to cease exporting two leading AI computing chips to China.

In response, Nvidia’s CEO Jensen Huang revealed that the company would introduce a new advanced chip known as the A800 in China to meet export control regulations. Additionally, the company made modifications to its flagship H100 chip earlier this year to comply with the regulations.

However, the proposed restrictions being considered by the Commerce Department would ban the sale of A800 chips to China without a special U.S. export license, according to the report.

At the time of reporting, the Commerce Department had not yet responded to a Reuters request for comment.

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