nvidia stock (NVDA) fell as much as 3% early Monday after the Biden administration Released updated export rule It aims to control the flow of AI chips to “enemies” such as China.
The White House said the rule would limit the number of artificial intelligence chips called graphics processing units (GPUs) that most countries can order without a special license to 50,000. Small orders of 1,700 GPUs or less will not count toward the export cap. About 18 US allies, including the United Kingdom, the Netherlands and Taiwan, will not face any restrictions.
As of 12:16:04 PM EST. The market is open.
“The United States must act decisively to lead this transformation by ensuring that American technology supports the global use of AI and that adversaries cannot easily misuse advanced AI,” the White House said in a statement on Monday.
For reference, Microsoft (MSFT) It is said alone It purchased 485,000 Hopper GPUs from Nvidia In 2024, while dead (dead) bought 224,000 AI chips, according to the Financial Times.
The White House said the rule aims to close loopholes in previous export restrictions on AI chips in 2022 and 2023 “by thwarting smuggling” and “raising AI security standards.”
“These restrictions will make it more difficult for Chinese entities to purchase NVIDIA’s more advanced chips,” DA Davidson analyst Gil Loria told Yahoo Finance in an email on Monday.
“Although there were already some restrictions on chip sales, they were already in place Reports of advanced NVIDIA chipsets arriving in China“This is likely due to the fact that NVIDIA has limited control over its distributors,” Loria explained in an earlier email last week.
In addition to advanced Nvidia chips sold through resellers, Nvidia manufactures specific versions of chips that comply with current U.S. trade restrictions on China. According to the Financial Times, Nvidia H20 chips – Hopper chips for China – You will not be subject to the new rule.
Nvidia’s vice president of government affairs, Ned Finkel, said in a statement Monday that the rule was “drafted in secret and without proper legislative review.”
“By attempting to manipulate market outcomes and stifle competition — the lifeblood of innovation — the Biden administration’s new rule threatens to squander America’s hard-earned technological advantage,” he said.
Companies have A longer than usual period of 120 days to provide comment on the restrictionsBloomberg reported, giving the Trump administration time to make changes to the rule, which is scheduled to take effect in one year. Nvidia’s statement included an apparent appeal to the incoming administration.
“As the first Trump administration demonstrated, America wins by innovating and competing and by sharing our technologies with the world — not by retreating behind a wall of government overreach,” Finkel said. “We look forward to returning to policies that strengthen American leadership, support our economy, and maintain our competitiveness in AI and beyond.”
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