Nvidia’s stock fell nearly 2% on Monday after the Biden administration released an updated export rule aimed at controlling the flow of artificial intelligence chips to “adversaries” like China. The new rule caps the number of AI chips, or GPUs, that can be ordered by most countries without a special license.
The White House said the rule is necessary to ensure US technology undergirds global AI use and prevents adversaries from abusing advanced AI. The US allies not subject to restrictions include the UK, Netherlands, and Taiwan, while 24 countries including China, North Korea, and Russia face an outright ban on receiving exports of the latest AI chips.
The primary significance of the updated restrictions is in their cap on the amount of compute capacity in a given group of AI chips that can be shipped to remaining countries. US companies can ship AI chips with a total compute capacity of 790 transistors per square millimeter, equivalent to roughly 50,000 Nvidia Hopper chips.
Analysts expect the new rule will make it harder for Chinese entities to purchase advanced NVIDIA chips. The Semiconductor Industry Association echoed this sentiment, stating that they are “deeply disappointed” in the rushed policy shift.
Nvidia’s stock has been under pressure since last week’s announcement of updated export controls, and the latest drop takes its decline over the past five sessions to around 9%.
Source: https://finance.yahoo.com/news/nvidia-stock-falls-after-biden-administration-releases-updated-export-rule-for-ai-chips-151755666.html