Latest news with #AIDiffusionRule
USA Today
6 days ago
- Business
- USA Today
Nvidia stock investors just got great news from the Trump Administration
Nvidia (NASDAQ: NVDA) has been a cornerstone of the artificial intelligence (AI) boom. The stock has advanced 1,070% since January 2023 as the company has reported tremendous financial results, driven by strong demand for its graphics processing units (GPUs) and other data center infrastructure. Nevertheless, export restrictions imposed by the U.S. government have cost the company billions of dollars in sales. Fortunately, Nvidia shareholders recently got great news from the Trump administration: Applications to resume selling its H20 GPUs in China will be approved by the Commerce Department. Here's what investors should know. How semiconductor export restrictions have impacted Nvidia under the Biden and Trump administrations China has historically been a major market for Nvidia. It accounted for 26% of revenue in the fiscal year that ended in January 2022. But export restrictions dragged that figure down to 22% in fiscal 2023, 17% in fiscal 2024 and 13% in fiscal 2025. Meanwhile, CEO Jensen Huang estimates Nvidia's market share in artificial intelligence (AI) chips in China has fallen from 95% to about 50%. The timeline below briefly explains how U.S. policy has evolved over time. On the first-quarter earnings call, Nvidia CFO Colette Kress said, "Losing access to the China AI accelerator market, which we believe will grow to nearly $50 billion, would have a material adverse impact on our business going forward and benefit our foreign competitors worldwide." CEO Jensen Huang has called the export restrictions a failure. He said in May: The question is not whether China will have AI. It already does. The question is whether one of the world's largest AI markets will run on American platforms. Shielding Chinese chipmakers from U.S. competition only strengthens them abroad and weakens America's position. The Trump administration will grant licenses allowing Nvidia to sell H20 GPUs in China On Monday, July 14, Nvidia said it has filed applications to resume selling H20 GPUs in China and has received assurances from the U.S. government that licenses will be granted. The news came days after CEO Jensen Huang met with President Trump, and the company plans to begin delivering compliant AI accelerator chips to China soon. Additionally, the Trump administration revoked the Biden-era AI Diffusion Rule earlier this year, which would have limited Nvidia's ability to sell its most advanced AI chips in dozens of countries that have historically been U.S. allies, including Saudi Arabia, the United Arab Emirates (UAE), Singapore and Israel. The Commerce Department said the AI Diffusion Rule, which was announced during the final days of the Biden administration, would have "stifled American innovation and saddled companies with burdensome new regulatory requirements." Additionally, it would have "undermined U.S. diplomatic relations with dozens of countries by downgrading them to second-tier status." Nvidia has already capitalized on the rescission of the AI Diffusion Rule as more countries lean into sovereign AI — meaning wholly owned data center infrastructure not subject to control by another nation. Earlier this year, the company announced partnerships that will bring its chips and networking equipment to Saudi Arabia and the UAE. Wall Street analysts are likely to increase earnings estimates for Nvidia Ultimately, the Trump administration's decision to permit the sale of H20 GPUs into China, coupled with its rescission of the AI Diffusion Rule, means Nvidia now has a larger total addressable market. In turn, Wall Street analysts are likely to raise earnings estimates, and upward revisions tend to correlate with share-price appreciation. The Wall Street consensus currently says Nvidia's earnings will grow at 41% annually through the fiscal year ending in January 2027. That makes the current valuation of 54 times earnings look tolerable. However, upward revisions to earnings estimates would make the stock even more attractive. Investors interested in adding shares to their portfolios should consider buying Nvidia stock now. Trevor Jennewine has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy. The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY. Should you invest $1,000 in Nvidia right now? 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The Star
15-07-2025
- Business
- The Star
Miti's AI chip export rule to have no impact on data centres
KUALA LUMPUR: MIDF Amanah Investment Bank Bhd believes that data centres will not be affected by the Ministry of Investment, Trade and Industry's (MITI) latest directive on artificial intelligence (AI) chips. The ministry has issued a directive which requires all exports, transshipments and transits of high-performance AI chips of United States (US) origin in Malaysia to obtain a Strategic Trade Permit (STP). In a research note today, the investment bank said the import of US-made advanced AI chips for use in domestic servers does not fall under the scope of the new rules unless the data centre operators intend to move the chips out of Malaysia. "There is zero impact from this directive in our opinion, as far as data centres in Malaysia are concerned. This is not an additional red tape that could delay the process of setting up a data centre in Malaysia,' it said. MIDF noted that since the beginning of the year, it has consistently reiterated that most new data centres are AI-ready, though some may eventually be used for non-AI purposes. The investment bank said the directive primarily addresses the movement of AI chips out of Malaysia, which it views as a prudent move by MITI to prevent suspected smuggling of chips into China through intermediaries. "This shows Malaysia's willingness to take responsibility for the movement of US-origin AI chips out of the country by stepping up its enforcement,' it added. MIDF said negotiations between Malaysia and the US will likely focus on regulatory enforcement, end-user monitoring, and the seriousness in addressing violations of the control measures. "MITI's latest directive covers all these. It is hoped that this will be able to placate the US when negotiating the restrictions of AI chip exports under Trump's refashioned AI Diffusion Rule,' it said. It added that speculation is growing around a possible shift from the current three-tiered country system to a licensing regime based on government-to-government agreements. This could mean that firms headquartered in the US or its close allies may no longer be restricted by the current seven per cent AI computing power limit for countries outside Tier 1, which allows for more AI capacities to be planned in countries such as Malaysia. "Regardless of the changes from Biden's rescinded Framework of AI Diffusion to the new rule being rewritten by the Trump administration, MIDF believes the essence remains, which is to contain China's AI advancement and ensure that US AI chips are not used to train Chinese AI models,' noted MIDF. - Bernama
The Sun
15-07-2025
- Business
- The Sun
MITI's AI chip export rule has no impact on Malaysia data centres
KUALA LUMPUR: MIDF Amanah Investment Bank Bhd has clarified that Malaysia's data centres will remain unaffected by the Ministry of Investment, Trade and Industry's (MITI) latest directive on artificial intelligence (AI) chip exports. The new rule mandates a Strategic Trade Permit (STP) for all exports, transshipments, and transits of US-origin high-performance AI chips in Malaysia. However, MIDF emphasised that domestic data centres using these chips will not face additional restrictions unless they plan to move the hardware out of the country. 'There is zero impact from this directive in our opinion, as far as data centres in Malaysia are concerned. This is not an additional red tape that could delay the process of setting up a data centre in Malaysia,' the investment bank said in a research note. MIDF highlighted that most new data centres in Malaysia are already AI-ready, though some may later be repurposed for non-AI applications. The directive primarily targets the movement of AI chips out of Malaysia, which MIDF views as a strategic measure to prevent unauthorised exports, particularly to China. 'MITI's latest directive covers all these. It is hoped that this will be able to placate the US when negotiating the restrictions of AI chip exports under Trump's refashioned AI Diffusion Rule,' MIDF added. The bank also noted potential shifts in US export policies, including a possible move from a three-tiered country system to a licensing regime based on government agreements. This could relax current computing power limits for non-Tier 1 nations like Malaysia, allowing greater AI capacity planning. Regardless of policy changes, MIDF believes the core objective remains unchanged: restricting China's AI development by preventing US chips from being used in Chinese AI training models. - Bernama
Barnama
15-07-2025
- Business
- Barnama
MITI's AI Chip Export Rule To Have No Impact On Data Centres -- MIDF
BUSINESS KUALA LUMPUR, July 15 (Bernama) -- MIDF Amanah Investment Bank Bhd believes that data centres will not be affected by the Ministry of Investment, Trade and Industry's (MITI) latest directive on artificial intelligence (AI) chips. The ministry has issued a directive which requires all exports, transshipments and transits of high-performance AI chips of United States (US) origin in Malaysia to obtain a Strategic Trade Permit (STP). In a research note today, the investment bank said the import of US-made advanced AI chips for use in domestic servers does not fall under the scope of the new rules unless the data centre operators intend to move the chips out of Malaysia. 'There is zero impact from this directive in our opinion, as far as data centres in Malaysia are concerned. This is not an additional red tape that could delay the process of setting up a data centre in Malaysia,' it said. MIDF noted that since the beginning of the year, it has consistently reiterated that most new data centres are AI-ready, though some may eventually be used for non-AI purposes. The investment bank said the directive primarily addresses the movement of AI chips out of Malaysia, which it views as a prudent move by MITI to prevent suspected smuggling of chips into China through intermediaries. 'This shows Malaysia's willingness to take responsibility for the movement of US-origin AI chips out of the country by stepping up its enforcement,' it added. MIDF said negotiations between Malaysia and the US will likely focus on regulatory enforcement, end-user monitoring, and the seriousness in addressing violations of the control measures. 'MITI's latest directive covers all these. It is hoped that this will be able to placate the US when negotiating the restrictions of AI chip exports under Trump's refashioned AI Diffusion Rule,' it said.
Techday NZ
07-06-2025
- Business
- Techday NZ
US-China chip export debate highlights risks for AI leadership
DeepSeek. TikTok. Taiwan. And a White House shake-up on AI rules. The spiralling US-China technology rivalry landed at the heart of Johns Hopkins University last week, as a panel of top experts and policymakers took to the stage to debate whether restricting exports of advanced semiconductors to China can help the US maintain its edge in the race for artificial intelligence. The discussion, hosted by Open to Debate in partnership with the SNF Agora Institute, comes at a critical time. In Washington, the Trump administration has announced plans to roll back the Biden-era AI Diffusion Rule and introduce new chip export controls targeting China – a move seen by many as a signal that the technology contest between the two superpowers is only intensifying. On one side of the Johns Hopkins debate were Lindsay Gorman, managing director at the German Marshall Fund's Technology Program, and former CIA officer and congressman Will Hurd. They argued the answer is yes: semiconductor controls can give the US a real advantage in the AI race. Gorman pointed to DeepSeek, a Chinese AI model whose CEO has publicly lamented the impact of advanced chip bans. "Money has never been the problem for us. Bans on shipments of advanced chips are the problem. And they have to consume twice the power to achieve the same results," she quoted, highlighting how China's AI advances still depend heavily on imported hardware. "The United States has significant hard computing power advantages – the ability to produce high-end chips, designed specifically for training AI models," Gorman told the audience. She argued that, together with its allies, the US controls a "strategic choke point" on computing power. "Properly implemented controls can have an effect and also have an increasing and compounding effect over time in retarding China's AI advantages and giving the United States a head start," she explained. Will Hurd, who also served on OpenAI's board before running for US president, compared the AI contest to the nuclear arms race. "Artificial intelligence is the equivalent of nuclear fission. Nuclear fission controlled gives you nuclear power… uncontrolled, nuclear weapons can kill everybody," he said. Hurd emphasised the importance of first-mover advantage, warning that the US cannot afford to lose its technological lead. He also highlighted a lack of reciprocity in the tech relationship between the two countries. "Chinese companies like Baidu, DJI, and TikTok operate freely in the US, but American companies are not allowed to operate in China," Hurd pointed out. "If there was a level of reciprocity between our two countries, we wouldn't be here having this debate about chip controls." Yet, on the opposing side, former senior US diplomat Susan Thornton and technology strategist Paul Triolo insisted the US could not outpace China in AI simply by tightening export controls. Triolo argued that the controls are "not working and will not lead to US dominance in AI", describing them as a blunt instrument that creates confusion for industry and disrupts global supply chains. "Most experts believe that Chinese companies are only three months behind US leaders in developing advanced AI models," Triolo said, suggesting any technological gap is vanishingly slim. Thornton, who spent decades at the heart of US-China diplomacy, warned of unintended consequences. "The main thing we should be asking ourselves about this question… is what is the cost benefit of US policy actions?" she said. "We have to face the reality that China is already building AI… a third of the world's top AI scientists are Chinese. China is one third of the entire global technology market. So it's clearly a player." She cautioned that blocking China from critical technology could backfire, hurting US companies, alienating allies and raising the risks around Taiwan, the global centre of advanced chip manufacturing. "Certainly, the one thing we need to do is avoid going to war," Thornton warned. "Taiwan, the most sensitive issue in US-China relations, has now been dragged right into the middle of this AI issue because they're the place that produces all the cutting-edge chips that we're trying to control." Audience members pressed the panel on whether international collaboration on AI safety was possible, and whether the US could ever match China's data advantage, given the size of the Chinese population and its permissive data environment. Hurd conceded that "the US will always have less data because we have a little thing called civil liberties," but argued that superior algorithms and privacy-protective machine learning could level the playing field. For Triolo, the dynamic nature of the technology means that attempts to wall off China are self-defeating. "There are many ways to get to different ends. The controls have forced Chinese companies to work together, develop innovations, and become more competitive both domestically and globally," he said. Gorman, in closing, rejected what she called "a defeatism that says America can't out-compete China or slow its progress". "Our companies are doing well. There isn't an issue here with demand, it's with supply. Doing better means that we have to throw what we can at this problem now with a smart application of tools," she argued. But Thornton had the last word, urging caution. "Making the AI competition with China a zero-sum game, not only will not work, it is dangerous," she said. "We should focus on the things that are going to matter to our children and their children, which is the long-term AI competition, which if not constrained and bounded by international agreements and by cooperation among countries… it'll be a very dangerous world."
