Nvidia’s share price has fallen by 2.2% after Chinese regulators issued guidance discouraging AI firms from buying the company’s H20 chips, due to US export restrictions. This move affected Nvidia suppliers like Samsung and SK Hynix, leading to a decline in their shares as well.
However, Chinese chipmakers Cambricon and Semiconductor Manufacturing International Corp. (SMIC) saw their shares soar by 20% on Monday after Beijing gave them guidance. Naura Technology Group’s stock also increased by 9.8% in Shenzhen.
Western export controls have slowed China’s AI efforts in recent years. Huawei’s progress was set back two years due to redesigns needed for its local production, and the performance of its latest chips may be limited by production problems at SMIC.
ByteDance reportedly plans to use Huawei’s 910B chips to train an upcoming model, but this would require significant computational power. The export controls have pushed China’s chip sector to adapt and work faster. However, experts warn that US efforts to slow China in the AI race are unlikely to be successful in the long run.
Nvidia’s stock has more than doubled so far this year due to its outsize role in the market. The company is heavily reliant on sales to China, which has been impacted by the guidance from Beijing.
Source: https://fortune.com/2024/09/30/nvidia-shares-fall-china-guidance-ai-chips-cambricon-smic-huawei/