Nvidia falls as Beijing discourages local companies from buying Nvidia chips

Investing.com — Nvidia fell on Friday as Beijing pressures Chinese companies to buy artificial intelligence chips that are made in China, rather Nvidia chips, as part of an effort to boost its domestic semiconductor industry and cushion the impact of U.S. restrictions, Bloomberg reported Friday, citing unnamed sources.

NVIDIA Corporation (NASDAQ: ) fell 3% in recent trading.

Chinese regulators have discouraged companies from buying Nvidia’s H20 chips, which are used to develop and implement AI models, the sources told Bloomberg.

But the new policy is not an outright ban on Chinese companies buying Nvidia chips, but rather a guideline, as Chinese regulators are keen to avoid limiting AI startups in the country and escalating tensions with the US, the sources said.

Nvidia declined Bloomberg’s request for comment. China’s Ministry of Commerce, Ministry of Information and Technology and Cyberspace Administration did not respond to Bloomberg’s faxed requests for comment.