Home Intel and AMD stocks fall on reports of Chinese restrictions on US chips

Intel and AMD stocks fall on reports of Chinese restrictions on US chips

Intel and Advanced Micro Devices (AMD) witnessed their stock price fall more than 2% on Monday (Mar.25) following reports China would restrict the use of their chips and servers in government devices.

The latest salvo in the ongoing chip trade war between the USA and China poses a threat to billions of dollars in sales for the tech giants and could be an intriguing sequel to the story after China warned the proposed TikTok ban would “come back to bite” America.

In recent days, the Beijing administration has set out fresh guidelines to effectively phase out US chips from Intel and AMD with further plans to jettison Microsoft as part of a protectionist ploy to favor and support domestic providers.

China has been pouring significant resources into its semiconductor industry in recent times as it contends with moves from Washington to restrict and stifle the export of the highly sought-after chips, especially those on the cutting edge of development.

As part of these measures, the country’s leading chipmaker SMIC has established new production lines in Shanghai to manufacture next-generation 5-nanometer (5nm) mobile processors. The chips are designed by technology giant Huawei as part of its homegrown Kirin line of smartphone processors.

How will Intel and AMD revenues be impacted by the Chinese restrictions

The importance of the headline curbs is instantly reflected in the figures as China was Intel’s largest market in 2023 with a 27% share of its revenue. It was less than one-fifth for AMD with 15% of its revenue coming from the sprawling Asian state but still of considerable importance.

Stacy Rasgon, a senior figure at Wall Street research firm Bernstein commented on developments with the following analysis:

“A total cessation of China governmental purchases of Intel and AMD CPUs might impact revenue by low-single digits,” he said, with a prediction of a maximum $1.5 billion hit for Intel and a few hundred million dollars for AMD.

Image credit: Ideogram

About ReadWrite’s Editorial Process

The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Graeme Hanna
Tech Journalist

Graeme Hanna is a full-time, freelance writer with significant experience in online news as well as content writing. Since January 2021, he has contributed as a football and news writer for several mainstream UK titles including The Glasgow Times, Rangers Review, Manchester Evening News, MyLondon, Give Me Sport, and the Belfast News Letter. Graeme has worked across several briefs including news and feature writing in addition to other significant work experience in professional services. Now a contributing news writer at ReadWrite.com, he is involved with pitching relevant content for publication as well as writing engaging tech news stories.

Get the biggest tech headlines of the day delivered to your inbox

    By signing up, you agree to our Terms and Privacy Policy. Unsubscribe anytime.

    Tech News

    Explore the latest in tech with our Tech News. We cut through the noise for concise, relevant updates, keeping you informed about the rapidly evolving tech landscape with curated content that separates signal from noise.

    In-Depth Tech Stories

    Explore tech impact in In-Depth Stories. Narrative data journalism offers comprehensive analyses, revealing stories behind data. Understand industry trends for a deeper perspective on tech's intricate relationships with society.

    Expert Reviews

    Empower decisions with Expert Reviews, merging industry expertise and insightful analysis. Delve into tech intricacies, get the best deals, and stay ahead with our trustworthy guide to navigating the ever-changing tech market.