US President Donald Trump’s administration plans to rescind the previous administration’s artificial intelligence (AI) chip curbs as part of a broader effort to revise semiconductor trade restrictions that have drawn strong opposition from major tech companies and foreign governments, people familiar with the matter said.
The repeal, which is not yet final, seeks to refashion a policy launched under former US president Joe Biden that created three broad tiers of countries for regulating the export of chips from Nvidia Corp and others.
The Trump administration would not enforce the AI diffusion rule when it takes effect on Thursday next week, the people said.
Photo: AFP
The changes are taking shape as Trump prepares for a trip to the Middle East, where a number of countries, including Saudi Arabia and the United Arab Emirates, have bristled at restrictions on their ability to acquire AI chips.
Trump officials are actively working toward a new rule that would strengthen the control of chips abroad, the people said.
Shares of chipmakers rose on Wednesday after Bloomberg News reported on the move. Nvidia climbed 3.1 percent, and the Philadelphia Stock Exchange Semiconductor Index — a closely watched benchmark — gained 1.7 percent.
Photo: Reuters
“The Biden AI rule is overly complex, overly bureaucratic and would stymie American innovation,” the US Department of Commerce’s Bureau of Industry and Security said in a statement. “We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance.”
The commerce department would continue to strictly enforce chip export curbs while it develops a new rule, the people said.
One element would be to impose chip controls on countries that have diverted chips to China, including Malaysia and Thailand, one of the people said.
Meanwhile, Arm Holdings PLC shares fell more than 10 percent in late trading after giving a disappointing sales forecast for the current quarter, stoking concerns about a tariff-fueled slowdown for the chip industry.
Revenue would be US$1 billion to US$1.1 billion in the fiscal first quarter, Arm said in a statement on Wednesday. Wall Street had estimated a number at the highest end of that range. Profit would be US$0.30 to US$0.38 a share, minus certain items, also lower than analysts’ projections.
“We’ve been conservative to make sure we don’t overreach,” Arm CEO Rene Haas said in an interview. “The health of the business is unbelievably strong. We’re seeing huge momentum in our data center business.”
Customers continue to push ahead with investment in chips, particularly for AI computing, and that is benefiting Arm, he said.
Arm decided not to provide investors with an annual target, because of economic uncertainty, executives told analysts on a call.
A dearth of forecasts from customers for this year means that Arm has less data on which to make its own projections, Arm chief financial officer Jason Child said.
Arm’s products — classified as services — are not directly affected by tariffs, Child said, adding that any hit, which has not been felt so far, would come in the form of suppressing demand for devices such as smartphones.
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