U.S. Government Blocks $5 Billion in Crucial AI Chips Ordered by Top Chinese Tech Giants: Report

President Joe Biden’s Commerce Department has blocked American chipmaker Nvidia from sending billions of dollars worth of key artificial intelligence (AI) chips ordered by top Chinese tech giants, the Wall Street Journal reported on Tuesday.

Nvidia was set to deliver over $5 billion in chips from Chinese orders, but the Biden administration is blocking them due to new chip restrictions, according to the WSJ. Nvidia was working on sending the chips before the restrictions took effect but the company received a letter notifying it that the sanctions would take effect immediately instead of one month after their announcement on Oct. 17, as originally scheduled, individuals with knowledge of the situation told the WSJ.

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U.S. Company Resumes Sales of High-Performance AI Chips to China

American chipmaker Nvidia confirmed that it has developed an alternative high-performance chip to offer Chinese customers after the Biden administration introduced export restrictions on U.S.-made chips in a bid to hamper China’s military, Reuters reported Monday evening.

Nvidia initially revealed late in August that the U.S. government had introduced export restrictions on chips with potential military applications, particularly in the field of artificial intelligence. While Nvidia has made no formal announcement of the new chip, known as the A800, but Chinese businesses have begun advertising it on their websites and an Nvidia spokesperson confirmed the existence of the chip, according to Reuters.

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U.S. Chipmaker Ordered to Halt Sales of Semiconductors to China

American chipmaker Nvidia announced in a Wednesday quarterly report that the U.S. government informed them of a new license requirement that would prohibit the sale of two advanced chips to China and Russia.

The U.S. government was concerned that the chips, which have applications in artificial intelligence work, might be co-opted by the Chinese or Russian militaries, according to Nvidia’s quarter two report. The chips were expected to generate $400 million in quarterly sales, revenue which is now in jeopardy from the new restriction, according to Reuters.

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