US Tries to Crush the AI Ambitions of China With a Crackdown on Chips

The new restrictions affect Nvidia's H20 chips and AMD's MI308 products

- Liza Lin & Amrith Ramkumar

New U.S. chip-export limits that rocked global markets on Wednesday are the clearest sign yet from the Trump White House that whatever advances China makes in AI will have to happen without America's help.

Trump administration officials have signaled for months that they were considering a crackdown on exports of processors from U.S. companies such as Nvidia that have helped enable major Chinese advances in artificial intelligence. The latest reckoning came this week, with U.S. authorities moving to stop the flow of billions of dollars of Nvidia and Advanced Micro Devices artificial-intelligence chips to the country.

The move, spurred in part by the Chinese AI startup DeepSeek's surprising success in building powerful models with less computing power, put an end to Nvidia's ability to skirt U.S. constraints on sales by tweaking its chips. While the changes affect a relatively small portion of the companies' business, they squash any hopes of unimpeded future chip sales to China.

Shares of Nvidia and AMD each dropped around 7% on Wednesday. The broader stock market sagged on news that any hope of a reprieve from the highest "reciprocal tariffs" imposed on China was short-lived.

Nvidia Chief Executive Jensen Huang isn't giving up on China. On Thursday, Chinese state media said Huang arrived in Beijing, where he met a Chinese official and said the country was an important market for his company. He also visited Beijing in January for a company event.

The new restrictions, which affect Nvidia's H20 chips and AMD's MI308 products, capped a roughly two-week blitz that created profound market whiplash and underscored the Trump administration's determination to engage China on many fronts. The battle for tech supremacy is set to unfold in much the same way as the trade war: with toughness and a bit of chaos.