Nvidia stock was falling early Monday on concerns the chip maker could face further restrictions on exports of its artificial intelligence chips to China.
Nvidia
(ticker: NVDA) shares were down 1.2% in premarket trading on Monday at $449.38. The stock has more than tripled in value this year on excitement over its AI chips but was down 2.2% over the last three months through to Friday’s close.
One concern that has been holding the stock back is that tensions between the U.S. and China could limit Nvidia’s exports, despite the company designing less-powerful chips for the Chinese market as a work around.
The U.S. government intends to tighten restrictions on AI chip exports to China and Nvidia’s H800 chip is a model that the administration would like to block, Reuters reported Sunday, citing a U.S. official and industry sources.
Nvidia, and The U.S. Department of Commerce, which oversees export controls, didn’t immediately respond to requests for comment early on Monday.
Nvidia has previously said that it wouldn’t see any near-term impact to its earnings from the expansion of export restrictions to cover the H800 and A800, two chips specifically designed for the Chinese market. However, Nvidia executives have said blanket bans on exports to China would affect the long-term growth of the U.S. chip industry.
Chinese companies Alibaba (BABA), Tencent, Baidu (BIDU), and TikTok-owner ByteDance collectively ordered around $5 billion worth of Nvidia’s A800 chips for delivery this year and next, according to a Financial Times report in August, citing people familiar with the matter.
Write to Adam Clark at adam.clark@barrons.com
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