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Nvidia Corporation NVDA may have found a workaround for the China export ban announced by the U.S. government in late August.
What Happened: Nvidia is offering a new chip, dubbed A800 graphic processor unit, to Chinese customers that may not be constrained by the U.S. government’s export licensing requirement, a spokesperson of the chipmaker told in a statement, according to Reuters.
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The chip is programmed such that performance does not exceed the stipulated level.
Chinese computer sellers have begun to advertise products with Nvidia’s new chip, the report said. This marked the first attempt by a U.S. semiconductor company to circumvent export restrictions, it added.
Why It’s Important: Shares of Nvidia and peers — including Advanced Micro Devices Inc. AMD — came under heavy selling pressure early in September, after Nvidia disclosed that the U.S. government had communicated to it in late August about a new licence requirement for future exports of its A100 and upcoming H100 chips to China and Russia.
AMD subsequently confirmed that its MI250 chip exports have been impacted by the same development.
The decision to bring the export of these high-performance processors under the regulatory net was to address the risk of them being potentially used by the military in China and Russia.
A recent Financial Time report said Alibaba Group Holding Limited BABA and other Chinese chip designers are reducing the processor speeds of chips to bypass the U.S. sanctions.
Price Action: Nvidia closed Monday’s session at $143.01, up 1.02%, according to Benzinga Pro data.
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Image and article originally from www.benzinga.com. Read the original article here.