“What’s actually happening is that the US government right now is handing China a big win as it tries to get their own chip business going,“ said Jack Gold, principal analyst at J.Gold associates.
When that happens, he added, it will be difficult for US chip makers to reclaim lost market share.
Nvidia expects the new rules to cost it $5.5 billion, while AMD forecast it could sap as much as $800 million from the company's bottom line, according to filings with the US Securities and Exchange Commission (SEC).
The United States had already restricted exports to China, the world's biggest buyer of chips, of Nvidia's most sophisticated graphics processing units (GPUs), designed to power top-end artificial intelligence models.
For AMD, the new US export control measure applies to its MI308 GPUs, which are designed for high-performance applications like gaming and artificial intelligence, it said in a filing.
Opportunity for China?
“It’s going to be a godsend for China as they spin up their own microprocessor business,“ Enderle said of the tightened US export rules.
The Chinese government has ample resources and motivation to bolster its chip industry, according to Gold.
Instead, Trump's tariffs have alienated allies, increasing their incentive to turn to China for chips, the analyst said.
“Companies located overseas are suddenly going to be in much better shape to compete.”
“Nvidia is one of the most important pieces in this (US) chess game with China,“ Wedbush analyst Dan Ives said in a note to investors.
Ives warned, however, that the chip wars are not over. He expects “more punches to be thrown by both sides.”
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