World's largest chip company faces new challenge

The US has expanded restrictions on exports of Nvidia artificial intelligence chips beyond China and Russia to other regions, including some countries in the Middle East.

Nvidia (one of the world's most valuable companies with a market capitalization of $1.2 trillion) said the restrictions affect its A100 and H100 chips designed to accelerate machine learning tasks.

“In the second quarter of fiscal year 2024 (ending July 30), the U.S. government notified us of additional licensing requirements for the A100 and H100 products for certain additional customers and regions, including certain countries in the Middle East,” Nvidia said.

The A100 and H100 chips support software training tools like ChatGPT. The Biden administration has banned Nvidia from selling these products to China and Russia. The company has therefore developed lower-performance H800 and A800 models to sell to China.

Nvidia did not give a reason for the new restrictions, nor did it specify which countries in the Middle East were affected.

Both Saudi Arabia and the United Arab Emirates (UAE) are on a buying spree for Nvidia chips (also known as graphics processing units (GPUs)) to fuel the growth of their tech sectors.

Nvidia’s revenue in the region, however, is negligible. The majority of the company’s $13.5 billion in revenue in the second quarter came from the US and China, and about 13.9% of revenue came from all other countries.

Despite the new restrictions, Nvidia said the licensing requirements have not significantly impacted the company's revenue, and that it is working with the US government to resolve the issue .

Nguyen Tuyet (According to Reuters, Tom's Hardware)

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