What’s the Impact of new US AI Chips Ban on Nvidia, AMD and Intel?

US Commerce on Tuesday announced an Advanced AI chips export ban on China that would create a negative impact on companies including Nvidia. Let’s check the details.

Following the announcement, stocks of Nvidia closed down about 5% while Broadcom and Marvell slipped about 2% and 1%, respectively. Shares of AMD fell more than 1% and Intel closed down about 1.4%.

Nvidia confirmed in an SEC filing on Tuesday that the current export ban covers its chips including A100, A800, H100, H800, L40, L40S, and RTX 4090 chips. The firm expresses that this new action would “hurt” its capability to complete product development on time.

An Nvidia spokesperson said that there’s no near-term impact on the company’s financial results due to the new restrictions. However, the same firm observed that it might hurt over the long term.

Industry analyst Ming-chi Kuo said the new ban would create a massive turmoil for Nvidia, which is in demand for Chinese customers. The company is likely to account for about 15-20 percent of the entire AI chip shipments for the next year. Kuo believes that Nvidia needs to closely monitor its growth and the negative chart after new bans on its Chinese customers

The current scenario could create a short-term entry opportunity for AMD stock if the price falls due to the latest US AI chip ban. However, AMD is primarily focused on its customers including CSP/service platform providers in North America.

Kuo says Intell may also have wide difficulty in making a good fortune out of the chip business because its two biggest customers reside in China. China has also named some of the equipment sellers but the US AI chips ban on China would severely impact these ones in the long term if it doesn’t appear immediately.

(source)