(Bloomberg) — Nvidia Corp. acknowledged that the US could impose tighter restrictions on chip sales to China and warned that such a move will hurt US companies in the long run, reiterating a widely held position among top chip makers.
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Nvidia Chief Financial Officer Colette Kress argued on a conference call with analysts on Wednesday that the existing restrictions on the sale of AI chips and high-performance components were already having the desired effect. The company is currently banned from offering its advanced graphics processing unit, or GPU, in the country, although it sells a less powerful version of the chip in China.
“In the long run, the restrictions prohibiting the sale of our data center GPUs to China, if implemented, will result in a permanent loss of an opportunity for the US industry to compete and lead in one of the world’s largest markets said Kress following Nvidia’s earnings announcement. The finance chief said she was dealing with reports on the potential for tighter regulation “on our exports to China.”
Read more: How the US and allies are trying to rein in Chinese technology
In the short term, however, stricter regulations would not take a heavy toll on Nvidia’s finances, she said.
“Given the strong demand for our products worldwide, we do not expect additional export restrictions on our data center GPUs, if passed, to have an immediate material impact on our financial results,” said Kress.
Kress boss, Chief Executive Officer Jensen Huang, recently joined his colleagues from Intel Corp. and Qualcomm Inc. on a visit to Washington to call for a pause in the escalation of export controls. The Biden administration says restrictions are needed to protect US national interests and prevent the advancement of China’s military.
Bloomberg has reported that further restrictions are being considered that would limit Nvidia’s ability to ship to the Asian country, its largest semiconductor market.
Read more: Huawei builds secret network for chips, Trade Group warns
Nvidia, which benefited from an industry-wide race to artificial intelligence, issued a third straight sales forecast on Wednesday that beat Wall Street estimates. That drove a stock rally of 6% in late trading. The company generates about two-thirds of its sales outside the US, but does not disclose sales figures in China.
The leading association of global chip companies, meanwhile, warns that Huawei Technologies Co. a collection of secret semiconductor manufacturing facilities across China is building — a shadow manufacturing network that will allow the blacklisted company to evade U.S. sanctions and advance the country’s technology ambitions — Bloomberg News has reported.
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