US moves to cut China chips
- The Commerce Department in January changed China chip rules again, allowing case-by-case licenses for Nvidia H200 and AMD MI325X exports instead of an outright presumption of denial. - The same administration also tightened pressure elsewhere, warning against Huawei Ascend use, adding 80 entities in March 2025, and penalizing Applied Materials $252 million in February. - Chip controls now swing between restriction and selective access as ASML and TSMC post strong 2026 results despite China risk. (bis.gov)
A semiconductor supply chain is the network that turns software designs into physical chips, using rare tools, chemicals, and factories spread across several countries. The U.S. has spent three years trying to decide which parts of that network China can still reach. (bis.gov 1) (bis.gov 2) The latest shift came on January 13, 2026, when the Commerce Department said exports of Nvidia H200, AMD MI325X, and similar chips to China could be reviewed case by case if applicants meet new security conditions. The rule took effect immediately. (bis.gov) Those conditions require exporters to show the sale would not reduce chipmaking capacity available to U.S. customers, that the Chinese buyer has compliance procedures, and that the product passed independent testing in the United States. Commerce said the change followed President Donald Trump’s December 8, 2025 announcement. (bis.gov 1) (bis.gov 2) That was a break from the Biden-era approach, which had steadily expanded restrictions on advanced computing chips, manufacturing gear, and China-linked entities. Commerce under Biden said those controls were meant to impair China’s ability to produce advanced-node semiconductors for artificial intelligence and military systems. (bis.gov 1) (bis.gov 2) The harder line did not disappear. On March 25, 2025, Commerce added 80 entities from China, the United Arab Emirates, South Africa, Iran, Taiwan and other places to the Entity List, saying the move would further restrict China’s artificial intelligence and advanced computing capabilities. (bis.gov) On May 13, 2025, the department also warned companies about using advanced China-made chips, including specific Huawei Ascend processors, saying those parts were likely developed or produced in violation of U.S. export controls. BIS said use of such chips could trigger enforcement under General Prohibition 10. (bis.gov) The equipment side matters because chipmaking tools are harder to replace than finished chips. In February 2026, Applied Materials agreed to pay about $252 million to settle charges that it and its Korean unit illegally exported U.S. semiconductor manufacturing equipment to China. (bis.gov) That pressure lands on companies already reporting how exposed they are to China demand. ASML said on April 15, 2026 that first-quarter net sales were €8.8 billion, while CNBC reported the stock fell as investors focused on tighter China restrictions despite the strong quarter. (asml.com) (cnbc.com) Taiwan Semiconductor Manufacturing Co., the world’s biggest contract chipmaker, reported first-quarter 2026 revenue of $35.9 billion and guided second-quarter revenue to $39.0 billion to $40.2 billion. Those numbers show demand for advanced chips is still rising even as export rules keep shifting. (investor.tsmc.com) Intel is part of the same industrial reshuffle. The company said at its foundry event in 2025 that it was pitching a globally diverse manufacturing and supply chain, and recent reports tied Intel to new outside foundry customers as governments and buyers push for production outside China. (intc.com) (trendforce.com) The result is not a simple cutoff. Washington is still blocking, warning, licensing, and penalizing at the same time — trying to deny China the most sensitive capabilities without severing every commercial link in the chip business. (bis.gov) (bis.gov)
