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Business Standard
08-05-2025
- Business
- Business Standard
Donald Trump to rescind global chip curbs, prepare new AI restrictions
The repeal, which is not yet final, seeks to refashion a policy launched under President Joe Biden that created three broad tiers of countries for regulating the export of chips from Nvidia and others Bloomberg By Stephanie Lai and Mackenzie Hawkins The Trump administration plans to rescind Biden-era AI chip curbs as part of a broader effort to revise semiconductor trade restrictions that have drawn strong opposition from major tech companies and foreign governments, according to people familiar with the matter. The repeal, which is not yet final, seeks to refashion a policy launched under President Joe Biden that created three broad tiers of countries for regulating the export of chips from Nvidia Corp. and others. The Trump administration will not enforce the so-called AI diffusion rule when it takes effect on May 15, the people said. The changes are taking shape as President Donald Trump prepares for a trip to the Middle East, where a number of countries including Saudi Arabia and the United Arab Emirates have bristled at restrictions on their ability to acquire AI chips. Trump officials are actively working toward a new rule that would strengthen the control of chips abroad, according to the people, who asked not to be identified because the change isn't yet public. Shares of chipmakers rose after Bloomberg News reported on the move. Nvidia climbed 3.1 per cent, and the Philadelphia Stock Exchange Semiconductor Index — a closely watched benchmark — gained 1.7 per cent. The government's decision could be announced as soon as Thursday, according to one of the people. Unveiled during Biden's last week in office, the diffusion rule established new US licensing obligations for AI chip shipments to much of the world as a final salvo after years of escalating restrictions on semiconductor trade. The measure sought to prevent China from acquiring AI chip technology via intermediaries and to bring more nations into the US orbit by setting security requirements to access best-in-class American technology. 'The Biden AI rule is overly complex, overly bureaucratic, and would stymie American innovation,' the Commerce Department's Bureau of Industry and Security said in a statement released by a spokesperson. 'We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance.' The Commerce Department will continue to strictly enforce chip export curbs while it develops a new rule, the people said. One element of the move to repeal the diffusion rule will be to impose chip controls on countries that have diverted chips to China, including Malaysia and Thailand, one of the people said. Nvidia, the leading maker of chips for training AI models, has objected to the growing number of US restrictions. The company has consistently derided the AI diffusion rule and pushed for its wholesale repeal, arguing that restrictions on third countries will only push them closer to China. Chief Executive Officer Jensen Huang said this week that US companies should be able to sell into China, which he predicts will become a $50 billion market for AI chips in the next couple years. Still, the Trump administration has stepped up restrictions targeting Beijing's tech ambitions. It already banned Nvidia from selling its H20 chip in China, a move that cost the company $5.5 billion in writedowns. Nvidia had no immediate comment. Repeal of the AI diffusion rule would mark a temporary reprieve for countries like India and Malaysia, which didn't face any chip curbs before January, when Biden unveiled the rule's framework. The Malaysia delay would be a boon to Oracle Corp., which plans a massive data center expansion there that was set to blow past AI diffusion rule limits. The Trump administration's move also would be welcome news for countries that were covered by earlier rounds of US restrictions, like the UAE and Saudi Arabia, but see fresh opportunities to negotiate better terms with the new team in Washington. Those two countries, along with the rest of the Persian Gulf and parts of Southeast Asia, have faced chip export controls since 2023 — meaning that an AI diffusion delay alone wouldn't lift licensing requirements on Nvidia sales to data centers there. Trump has expressed interest in easing restrictions for the UAE, Bloomberg News previously reported, and he could announce the start of work on a government-to-government AI chip agreement when he visits the emirate during a broader Middle East trip from May 13 to May 16. The UAE has been particularly active in pushing for such an accord, and has pledged to invest as much as $1.4 trillion in US technology and infrastructure over the next decade — a promise that bent the conversation in the country's favour. Striking accords with the wide range of countries eager to buy Nvidia chips would be a monumental task, and could result in dozens of separate policies by which companies must abide. The country tiers and associated chip export limits weren't the only new policy in the AI diffusion rule. The framework also established export controls for AI model weights, which are the numerical parameters that software uses to process data and make predictions or decisions. The Trump administration's plans for those curbs are under discussion.
Yahoo
30-04-2025
- Business
- Yahoo
Qualcomm Gives Soft Sales Forecast in Face of Trade Turmoil
(Bloomberg) -- Qualcomm Inc., the biggest maker of chips that run smartphones, gave a tepid revenue prediction for the current quarter, underscoring concerns that tariffs will hurt demand for its products. NYC Lost $9 Billion of Income to Miami, Palm Beach in Five Years New York City Transit System Chips Away at Subway Fare Evasion NYC's Congestion Toll Raised $159 Million in the First Quarter NJ Transit Urges Commuters to Work Remotely If Union Strikes The Last Thing US Transit Agencies Should Do Now Revenue in the period ending in June will be $9.9 billion to $10.7 billion, the company said Wednesday in a statement. The midpoint of that range was slightly below the average analyst estimate of $10.33 billion, sending the shares sliding in late trading. The outlook renewed concern that the market for smartphones will suffer from a looming trade war. Qualcomm is seen as highly vulnerable to the fallout from tariffs threatened by the US and China. The latter country is the biggest market for Qualcomm's chips, and local phone makers account for many of its top customers. Intel Corp. and others have given cautious outlooks — with some even warning that the economy may be headed for a recession. 'As we navigate the current macroeconomic and trade environment, we remain focused on the critical factors we can control — our leading technology road map, best-in-class product portfolio, strong customer relationships and operational efficiencies,' Qualcomm Chief Executive Officer Cristiano Amon said in a statement. The shares fell more than 4% in extended trading following the announcement. They had slid 3.4% this year, though that's a better performance than the 15% decline by the Philadelphia Stock Exchange Semiconductor Index. Third-quarter earnings will be about $2.70 a share, excluding some items, Qualcomm said. That compares with a Wall Street projection of $2.64. The San Diego-based company has projected that the smartphone market will grow by a percentage in the low single digits this year. In the fiscal second quarter, which ended on March 30, profit was $2.85 a share, excluding some items. Revenue rose 17% to $11 billion. Analysts had estimated earnings of $2.81 a share and sales of $10.6 billion. Phone-related sales were $6.93 billion in the period, compared with the average projection of $6.8 billion. Revenue of chips used in vehicles was $959 million. Connected-device semiconductor sales were $1.58 billion. Qualcomm supplies processors and modems that are the main components of the world's most advanced smartphones. While that market is no longer growing as quickly as it once did, the company's products are widely used in high-end Android phones. The chipmaker also collects fees calculated as a percentage of the cost of a handset regardless of whether the phone maker uses its chips. Qualcomm won those rights in intellectual property lawsuits around the world, establishing that it can charge royalties on its patents that cover the basic way that phones connect with networks. Under Amon, Qualcomm has been trying to lessen its reliance on the phone market with a push into new areas. That includes selling chips to automakers and offering new processors that it says are the best foundation for new artificial intelligence laptops. Made-in-USA Wheelbarrows Promoted by Trump Are Now Made in China As More Women Lift Weights, Gyms Might Never Be the Same Why US Men Think College Isn't Worth It Anymore The Mastermind of the Yellowstone Universe Isn't Done Yet Eight Charts Show Men Are Falling Behind, From Classrooms to Careers ©2025 Bloomberg L.P. Sign in to access your portfolio
Bloomberg
16-04-2025
- Business
- Bloomberg
Chipmakers Lead Tech Stock Rout as Trump Curbs Chips to China
Technology stocks led losses Wednesday morning after Nvidia Corp. and Advanced Micro Devices Inc. said President Donald Trump's administration has curbed the export of its chips to China, while ASML Holding NV offered a disappointing earnings report. The S&P 500 Index slid 1.43%, while the Nasdaq 100 Index dropped 2.21%. Nvidia sank as much as 7% after warning it will report around $5.5 billion in related charges during the fiscal first quarter, with AMD down 6.01% as it expects to take a charge of as much as $800 million. ASML plummeted 6.09%. The Philadelphia Stock Exchange Semiconductor Index fell 4.02%.
Yahoo
18-03-2025
- Business
- Yahoo
Intel Gains $22 Billion in Market Value After CEO Shake-Up
March 18 - Intel (INTC, Financial) shares surged about 24% after the appointment of Lip?Bu Tan as CEO nearly reaching $25.7 by Monday's close. The new leadership added $22 billion to market value and positioned Intel as the top performer on the Philadelphia Stock Exchange Semiconductor Index. Warning! GuruFocus has detected 6 Warning Signs with INTC. Ahead of his official start on Tuesday, Tan sent a letter to employees warning that reversing the company's decline would not be easy. His message left analysts questioning whether he would break up the business or fix it from within to address ongoing manufacturing and product challenges. Bank of America upgraded the stock, stating that the company now has a greater opportunity to restructure and turn things around under Tan's leadership. Tan pledged to rebuild Intel into an international leader in semiconductor manufacturing without specifying how to divide foundry production and chip research departments. The reporting idea that Taiwan Semiconductor Manufacturing (TSM, Financial) would manage U.S. factories at Intel remained unexplored during his interview with Reuters. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
18-03-2025
- Business
- Yahoo
Intel's New CEO Faces ‘Show Me' Moment After $22 Billion Rally
(Bloomberg) -- Since Intel Corp. announced that Lip-Bu Tan would take over as CEO last week, the company's shares have soared. Now, as Tan assumes his job, it is far from clear how he will fulfill the big hopes that have been placed on his shoulders. ICE Eyes Massive California Tent Facility Amid Space Constraints How Britain's Most Bike-Friendly New Town Got Built The Dark Prophet of Car-Clogged Cities Washington, DC, Region Braces for 'Devastating' Cuts from Congress NYC Plans for Flood Protection Without Federal Funds Ahead of taking on his new role on Tuesday, Tan sent a letter to employees warning that it won't be easy for the company to hold off the forces that have sent it into decline. But Tan didn't specify how he plans to tackle the problems, leaving analysts to wonder whether he will try to break up Intel and sell it off for parts, as many on Wall Street want, or whether he'll attempt a version of his predecessor's plan to work from the inside to fix its troubled manufacturing and product lines. It all adds up to a 'show me' moment for the company, according to Joe Tigay, portfolio manager of the Rational Equity Armor Fund. 'We're going to need to see some improvement in their product in order for it to get back to where it once was. And I think it's a great start, it's a good direction, but they are still a long ways away from where they were.' The announcement of Tan's appointment last Wednesday sparked a rally that has sent the stock up 24% through Monday's close, adding $22 billion to the company's market value and making it the top performer on the Philadelphia Stock Exchange Semiconductor Index since the beginning of the year. Bank of America upgraded the stock in the wake of the news, writing that it 'has a greater opportunity to restructure/turn things around' under Tan. Shares fell about 1% in early trading Tuesday, alongside a broader-market slip. But analysts noted that Tan's letter — in which he promised to re-establish Intel as a 'world-class foundry' for chips — did not make it clear if he is considering splitting up the company's foundry business from its chip-design arm, as has been discussed in the past. He also did not address recent reports that one of its biggest competitors, Taiwan Semiconductor Manufacturing Co., might help operate some of Intel's US factories at the request of the Trump administration. The optimism around Tan is in no small part a reflection of how far Intel has fallen from the days when it was the giant of the semiconductor industry. The stock is down about 60% from the peak it hit in early 2000, erasing more than $330 billion in market value for investors. Its recent woes have been tied closely to the company's struggles to compete with competitors in the race to create the specialized chips used by the artificial intelligence industry. On Monday, Reuters reported that Tan has considered significant changes to the company's chip manufacturing methods and artificial intelligence strategies, and that revamping the manufacturing operations is a key priority. Now, though, even the chipmakers who have profited from the recent excitement around AI are facing concerns about their prospects in the face of macroeconomic uncertainty and questions about the future demand for AI chips as AI models become more efficient. The Philadelphia semiconductor index, SOX, is down 21% from its peak last July through Monday's close. Against this backdrop, Intel's future looks particularly shaky. In late January, Intel gave a revenue forecast that was weaker than expected, the latest such let down. Of the past five reports, only one was met with a positive reaction in the shares, according to data compiled by Bloomberg. Estimates have repeatedly been cut in the wake of the disappointments, and analysts now expect a net loss of 28 cents per share in 2025, down from earnings of roughly 12 cents per share three months ago. The view for revenue has dropped more than 4% over the same period. Fewer than 10% of the analysts tracked by Bloomberg recommend buying Intel, and the recommendation consensus — a proxy for the ratio of buy, hold, and sell ratings — is essentially tied with the worst in the SOX. Intel trades about 5% above the average analyst price target, by far the worst implied return among chipmakers over the coming 12 months. Randy Hare, director of equity research at Huntington National Bank, is closely watching the $19 level as critical support for the stock, which last closed at $25.69. 'If Intel cuts its outlook and sets out a plan for growth, I would view it as a buying opportunity if the stock fell under $19 in that scenario,' he said. 'If it falls under $19 because it has no plan for growth and we don't see revenue accelerate, that's a sell signal.' Top Tech Stories Nvidia Corp. shareholders are hoping that a keynote speech from chief executive Jensen Huang can deliver enough optimism to help sustain the stock's recent rebound. Xiaomi Corp. raised its full-year delivery target of electric vehicles to 350,000 units as the company is venturing into the nascent field to drive growth. Grab Holdings Ltd. is moving forward with its attempt to take over GoTo Group, according to people familiar with the matter, who said the Singaporean ride and delivery firm has begun due diligence on its Indonesian rival. Alphabet Inc. is in talks to purchase cloud-security company Wiz Inc. for $33 billion, restarting discussions that were called off last summer after extended negotiations, according to people familiar with the matter. Tencent Holdings Ltd. released new AI services that turn text or images into 3D visuals and graphics, the latest in a series of products to emerge from big tech firms since DeepSeek galvanized Chinese and US artificial intelligence development. Earnings Due Tuesday Earnings Postmarket: StoneCo Ltd. (STNE US) --With assistance from Philip Sanders. (Adds stock move after market open in fifth paragraph) The Real Reason Trump Is Pushing 'Buy American' Tesla's Gamble on MAGA Customers Won't Work Snap CEO Evan Spiegel Bets Meta Can't Copy High-Tech Glasses Nvidia Looks Past DeepSeek and Tariffs for AI's Next Chapter How Trump's 'No Tax on Tips' Could Backfire for the Working Class ©2025 Bloomberg L.P. Sign in to access your portfolio
