U.S. Reverses Course on AI Chip Export Controls
The Trump administration has reversed its previous restrictions on U.S. companies exporting advanced
AI chips, signaling a major policy shift intended to bolster American technology leadership and support the semiconductor industry[3]. This move is particularly significant for leading U.S. chipmakers such as Nvidia and AMD, who can now resume shipments of AI hardware to China and other markets that were previously restricted.
Nvidia and AMD Regain Access to Chinese Market
- The original export ban, introduced in January 2025, halted the sale of high-performance GPUs, like Nvidia's H100 processors, to the Chinese market[3].
- Under the policy reversal, companies including Nvidia can now sell their H20 processors—engineered to comply with export rules—to China[3].
- AMD also received clearance to resume sales of its MI308 chips in China, causing both companies' stock prices to jump over four percent[3].
- Only “green-zone” chips, which meet specified technical limits, are cleared for export; more advanced chips remain restricted[3].
Rationale Behind the Policy Change
The administration’s decision responds to increasing pressure from industry leaders and the need to maintain U.S. competitiveness in the global
AI industry. China accounts for nearly half of the world's AI development companies, making it a key market for U.S. technology exports[3].
Maintaining a Strategic Balance
- The U.S. government emphasizes that the rollback is part of a broad strategy to balance national security concerns with economic imperatives[2][3].
- This approach allows American firms to capture revenue and market share critical to maintaining an edge against international rivals such as Huawei, whose Ascend chips are explicitly prohibited under ongoing U.S. export guidelines[1].
- Other export restrictions, like those on more advanced GPU models and on countries suspected of re-routing chips to China, remain in force[1][3].
New AI Policy Framework and Federal Support
The easing of export controls follows several high-profile initiatives by the Trump administration aimed at boosting the domestic AI sector:
- Signing of the “One Big Beautiful Bill Act,” allocating over $1 billion to expand federal use and development of
AI[2].
- Launch of a comprehensive AI Action Plan designed to accelerate infrastructure, reinforce U.S. global technology leadership, and streamline regulations for AI-related industries[4].
- Planned executive orders to further clarify U.S. strategy and ensure secure, innovation-driven growth in artificial intelligence[5].
Implications for the AI and Semiconductor Markets
- The reopening of exports is projected to restore billions in lost revenue to companies like Nvidia and AMD, reinforcing their vital role in the global semiconductor supply chain[3].
- By enabling the flow of certain AI chips to China, the U.S. seeks not only to support its domestic industry but also to position American platforms as central to AI advancement worldwide[4].
Remaining Limitations and Industry Outlook
Despite newly relaxed rules, the administration continues to emphasize vigilance regarding security risks. AI chip exports to China are allowed only for models that comply with performance caps, while advanced chips and transactions linked to military or dual-use purposes remain heavily regulated[1][3].
As U.S. chipmakers resume global sales under new regulatory clarity, the evolving policy landscape will remain critical for businesses and policymakers navigating the intersection of technology, security, and economic competition.
