NVIDIA Discloses US Ban On GeForce RTX 4090 Graphics Cards Exports To China
Over the past decade, what could be considered a trade war between the United States and China has seen volleys go back and forth between the two participants. This cold war could be tied back to 2012 when ZTE and Huawei were considered a security threat thanks to findings reported by the House Intelligence Committee.
However, this war became more visible under the Trump and Biden administrations. For example, the U.S. Congress has moved to block TikTok after concerns were raised about Chinese ties to the app and how user data is handled. More recently, there have been concerns raised about China's involvement and connections to IoT devices and how they might be means by which the country is collecting data on anyone who has these devices.
Besides concerns about Chinese spying, the United States has also raised concerns about the speed and efficacy with which China is developing military and artificial intelligence technologies. As such, there have been several pushes to restrict hardware exports to China in an effort to hinder these developments and help put the United States at the front of the technological pack. Subsequently, companies have to change their current course to incorporate these restrictions, which is what we are seeing with NVIDIA now.
In a filing with the Securities and Exchange Commission (SEC), NVIDIA notes that the U.S. government has announced the submission of the “Implementation of Additional Export Controls: Certain Advanced Computing Items; Supercomputer and Semiconductor End Use; Updates and Corrections.” This rule restricts or adds additional requirements to technology exports exceeding a certain threshold going to China or “Country Groups D1, D4, and D5 (including but not limited to Saudi Arabia, the United Arab Emirates, and Vietnam, but excluding Israel).” As for NVIDIA specifically, this affects the export of, but is not limited to, the A100, A800, H100, H800, L40, L40S, and RTX 4090.
While this might sound like quite the blow to NVIDIA, the filing explains that the company does not "anticipate that the additional restrictions will have a near-term meaningful impact on [its] financial results.” Of course, it is entirely possible that there may be more long-term effects from this rule, but those will certainly take some time to develop and come to fruition.
Despite the above remark, NVIDIA does note a concern that the requirements may slow R&D, and may impact dealings with its partners that operate in China for product assembly or repackaging. However, the SEC filing explains that “the licensing requirement applies to the export of products classified ECCN 3A090 or 4A090 to a party headquartered in, or with an ultimate parent headquartered in, Country Group D5, including China,” so it remains to be seen how this exactly plays out.
At the end of the day, the geopolitics and technological cat-and-mouse game between the United States and China is fascinating. Though this back-and-forth might be good for global security, it will catch companies like NVIDIA in the crossfire and inevitably cause some issues. In the end, this might be a necessary evil to prevent the unchecked development of weapons and technology platforms that threaten our or other countries' way of life.
