Xi Jinping's Military And Government Continue To Acquire Banned Nvidia Chips Amid US Export Restrictions: Report
Portfolio Pulse from Benzinga Neuro
Despite U.S. export restrictions, China's military, government sectors, AI institutions, and universities have continued to acquire NVIDIA Corp (NASDAQ:NVDA) chips, including banned A100, H100, A800, and H800 models. The chips have been sourced through an underground market, with vendors leveraging surplus stock or imports via third countries. Nvidia asserts compliance with export laws and readiness to act against unlawful resales. The U.S. is monitoring Nvidia's new AI accelerators for the Chinese market, while Nvidia explores expansion into other Asian markets like Vietnam.

January 15, 2024 | 1:46 am
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NVIDIA faces challenges with an underground market for its chips in China despite U.S. export bans, but it's actively complying with regulations and looking to expand in other Asian markets.
The news indicates a persistent demand for NVIDIA's products, which could be seen as a positive for the company's market position. However, the existence of an underground market and the company's need to navigate complex export restrictions could pose reputational risks and operational challenges. The company's efforts to comply with export controls and to pivot towards other markets like Vietnam may mitigate some negative impacts, but investor sentiment could be affected by concerns over regulatory compliance and geopolitical tensions.
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