Intel and Nvidia Reveal New Products for China, Adapt AI Chip Strategies in Response to US Sanctions

Zinger Key Points
  • Intel to launch AI chips with reduced capabilities for China, adhering to U.S. sanctions, with HL-328 and HL-388 chips coming in 2024.
  • Nvidia plans three China-specific chips as U.S. tightens AI chip embargo, adapting to regulatory constraints for market compliance.

Intel Corp INTC is looking to launch two artificial intelligence chips with diminished capabilities so that China can comply with U.S. semiconductor sanctions.

Intel’s two chips, HL-328 and HL-388, will likely launch in June and September.

Nvidia Corp NVDA is also eyeing three China-specific chips after the U.S. tightened its semiconductor embargo on China by including advanced AI chips, Reuters reports.

Intel’s China-specific AI chips are based on the company’s latest Gaudi 3 product line. They have similar hardware features, including on-chip memory, high-bandwidth memory, and interface standards.

Also Read: Intel and AMD Clash Over Huawei Chip Sales, Highlighting US Sanctions and Market Dynamics

However, the company will significantly reduce the chips’ performance to comply with the export control regulations.

One of Nvidia’s China-specific chips, the H20, will likely be delivered in small batches in the first quarter of 2024, with larger quantities expected in the second quarter.

Recent reports indicated Advanced Micro Devices, Inc AMD and Intel are encountering obstacles in China following the country’s decision to respond to U.S. semiconductor sanctions by removing foreign technology from its telecommunications networks. 

Chinese authorities have instructed significant telecom operators to eliminate foreign processors by 2027, directly affecting U.S. semiconductor leaders Intel and AMD. 

Intel stock gained 13% in the last 12 months. Investors can gain exposure to the stock via First Trust Nasdaq Semiconductor ETF FTXL and Invesco PHLX Semiconductor ETF SOXQ.

Price Action: INTC shares traded higher by 0.39% at $36.45 premarket on the last check Tuesday.

Also Read: Nvidia Leads AI Chip Rivalry with New GPUs, While AMD and Intel Bet Big on AI PCs

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