Intel and AMD Shares Dip as China Enforces Restrictions on U.S. Chipmakers

Intel and Advanced Micro Devices (AMD), two prominent U.S. chipmakers, are encountering fresh limitations in China, indicating an escalation in the ongoing technological standoff between the U.S. and China.

“This development is significant as China represents a crucial market for both companies,” says FactSet data, with Intel garnering roughly 27% of its revenue from mainland China and AMD deriving 15% of its revenue from the country.

The news of these restrictions caused premarket trading shares of Intel and AMD to decline by 2.5% and 2.3%, respectively. The full impact of these restrictions, initially targeted at Chinese government devices, on the broader market remains uncertain.

Tech Giants Navigate China’s Market

Despite facing regulatory hurdles, U.S. technology firms persist in seeking opportunities within China. Apple’s CEO Tim Cook recently revealed plans for the launch of the Vision Pro headset in mainland China, underscoring the company’s steadfast commitment to the Chinese market, despite previous restrictions on iPhones.

Intel and AMD Shares Dip as China Enforces Restrictions on U.S. Chipmakers
Meta and Apple strategically enter China’s VR market, reflecting the global tech industry’s pivot towards immersive technologies.

Likewise, Meta Platforms has struck a preliminary deal with Tencent Holdings to introduce a budget-friendly version of its VR headset in China, to break into a market dominated by local players.

This strategic maneuver reflects Meta’s determination to expand its footprint in the Chinese virtual reality sector, notwithstanding historical barriers that have prevented its other services, such as Facebook, Instagram, and WhatsApp, from accessing the Chinese market since 2009.

AI and VR: A New Frontier

The exploration of artificial intelligence (AI) and virtual reality (VR) technologies is rapidly becoming a focal point for tech enterprises. Micron Technology, in particular, is witnessing a surge in demand for its chips, attributed to their pivotal role in AI applications, thereby underscoring the significant growth prospects within the sector.

Intel and AMD Shares Dip as China Enforces Restrictions on U.S. Chipmakers
AMD and Intel pursue opportunities in AI amid China’s regulatory challenges, underscoring their commitment to technological advancement.

Both AMD and Intel are actively seeking to leverage the burgeoning AI landscape, notwithstanding the obstacles presented by China’s regulatory constraints. Meanwhile, in China’s VR market, strategic maneuvers by Meta and Apple highlight the global tech industry’s pivot towards immersive technologies.

Meta’s collaboration with Tencent and Apple’s rollout of the Vision Pro headset in China exemplifies concerted endeavors aimed at securing a foothold in this burgeoning market segment.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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