Cadence and Synopsys, leading chip design software makers, saw their shares decline on Wednesday after a report from the Financial Times revealed the US Commerce Department’s directive to stop selling to Chinese organizations. The move follows the Trump administration’s decision to scrap the Biden-era “Diffusion Rule” limiting AI processor exports to China.
The Bureau of Industry and Security sent letters to both companies and Siemens, warning them about using Huawei Ascend AI chips. Synopsys CEO Sassine Ghazi stated that the company expects a decline in full-year revenue from China due to the new policy. Cadence representatives did not respond to requests for comment.
The US Commerce Department’s action follows an earlier warning issued by the Bureau of Industry and Security, which could impact Nvidia’s business as it reports results after the bell on Wednesday. China’s Ministry of Commerce has demanded that the White House “correct its mistakes,” claiming the move undermines their preliminary trade agreement.
Source: https://www.cnbc.com/2025/05/28/chip-software-trump-china.html