AMD faces setback as US Government blocks sale of AI chip to China

Advanced Micro Devices has encountered a challenge in its efforts to offer an artificial intelligence chip specifically designed for the Chinese market, Bloomberg News reported.

The move comes amidst Washington’s intensified scrutiny and crackdown on the export of advanced technologies to China.

According to sources familiar with the matter, AMD sought approval from the US Commerce Department to sell the AI processor to China, which was specifically designed to comply with US export restrictions.

However, the chip’s performance, albeit lower compared to versions sold outside of China, has been deemed by US officials as still too powerful.

Consequently, the company has been instructed to obtain a license from the Commerce Department’s Bureau of Industry and Security to proceed with the sale in China.

The AI chip developed by AMD, although tailored for the Chinese market and designed to meet US export regulations, has encountered regulatory hurdles due to concerns over its capabilities.

Despite efforts to ensure compliance, US officials maintain that the processor requires further scrutiny and control to prevent its potential misuse or diversion for military purposes.

Neither AMD nor the Commerce Department immediately responded to requests for comment from Reuters.

This development follows broader measures taken by the US government to curb the flow of advanced technologies to China, particularly those with potential military applications.