Latest news with #AIDiffusion
Egypt Independent
27-05-2025
- Business
- Egypt Independent
Will ‘massive' Gulf deals cement the US lead in the race for global AI dominance?
CNN — US President Donald Trump's whirlwind visit last week to the Middle East saw a wave of AI dealmaking that could reshape the global technology landscape. On May 12, Saudi Arabia's sovereign wealth fund Public Investment Fund announced the establishment of AI startup Humain. US companies Nvidia, AMD, and Qualcomm also announced deals to supply chips and partner on AI infrastructure with Humain. The Trump administration also announced that it would rescind and replace the 'AI Diffusion' rule, a Biden-era regulation capping sales of the most advanced chips that was set to take effect on May 15. On the final leg of the tour, the US and the United Arab Emirates (UAE) announced that they will partner to build a data center complex in Abu Dhabi with 5-gigawatts of capacity – the largest data center cluster outside of the US, according to the Commerce Department. By comparison, the current global market capacity of data centers is approximately 59 gigawatts – according to Goldman Sachs. The Trump administration said that it also secured Saudi and UAE investment for data centers located in the US. In Abu Dhabi, Trump said that the countries had 'agreed to create a path for the UAE to buy some of the world's most advanced AI semiconductors from American companies.' The deals, and new partnerships, could reshape the global AI landscape in myriad ways, according to officials and experts. 'We're still waiting for the full details to emerge, but the scale of some of these announced projects is massive,' says Sam Winter-Levy, a fellow at the Carnegie Endowment for International Peace, whose focus is technology and international affairs. Trump attends a business meeting and roundtable at Qasr Al Watan, in Abu Dhabi, United Arab Emirates, on Friday, May 16, 2025. Altaf Qadri/AP A 'game-changer' for the global AI race In recent years, Beijing and Washington have been vying for supremacy in AI technology that could confer the winner advantages in economic productivity, scientific breakthroughs and national security. Trump's AI czar David Sacks said in a post on X that the deals are a 'game-changer in the global AI race' that will 'help to cement American technology as the global standard – before our competitors can catch up.' Some experts agree that working with the Middle East will fill gaps in current US capabilities. AI models require vast amounts of computing power, commonly referred to simply as 'compute,' to train and run. That requires huge amounts of energy. 'We have a huge problem when it comes to fueling our own data center infrastructure in the US,' Mohammed Soliman, a senior fellow at the Middle East Institute think-tank in Washington-DC, tells CNN. Men use their phones during the Saudi-US Investment Forum, in Riyadh, Saudi Arabia, May 13, 2025. Brian Snyder/Reuters Growing demand for energy to power data centers has strained parts of the US grid. Although some say the issue can be resolved domestically, others say partnering with the oil-rich Gulf is a wise strategic bet. 'There's not really an immediate [domestic] solution,' Soliman adds, 'You need to invest heavily in energy infrastructure, and that takes capital, land, a lot of resources, and time.' But some are concerned about how the flow of chips to the Gulf will be controlled. On May 19, leading Democrats warned in a letter that 'the deals – without any clear and enforceable protections to stop this sensitive technology from falling into China's hands – present an immediate national security threat.' If chips are given directly to Saudi and Emirati companies, without the right safeguards, it could present national security risks, and the nations could employ them for tasks like autonomous weapons research and development, says Winter-Levy. In another possible scenario, in which the data centers might be controlled and operated by US tech companies, he says the risks are more limited. The UAE and Saudi Arabia both have ambitious plans to build AI industries to prepare their economies for a post-oil future. US authorities say that not working with the Gulf could have increased the risks of a Gulf-China AI alliance. The chip technology of companies like Huawei is quickly advancing. 'If we reject them, we will drive them into China's arms,' said Sacks' X post. US President Donald Trump, Saudi Crown Prince Mohammed Bin Salman and others listen during a Saudi-US investment forum at the King Abdul Aziz International Conference Center on May 13, 2025, in Riyadh, Saudi Arabia. Brendan Smialowski/AFP/Getty Images Advancing Gulf AI ambitions While much is still unknown, one thing is clear: The Gulf's role in the global AI landscape is growing. 'This could well see the emergence of the Gulf as the third-biggest power in the AI competition,' says Winter-Levy. 'If the countries use the chips to train their own frontier models, the Gulf could move closer to competing with the US on the technology.' He adds that current talent constraints might hold the region back from competing with current AI leaders US and China. Experts say the deals mark a new era in US-Gulf relations. 'This is going to be a pivotal moment for the way the US-Gulf relationship is defined,' says Soliman. 'It's no longer about crude; it's mostly about compute.' In the Democrats' letter, they urged the administration to make sure 'American technology prioritizes the buildout of this critical industry here at home, not abroad.' But if a situation emerges in the future where a significant amount of US computing power is in the region, said Winter-Levy, it could give Gulf governments 'some significant degree of leverage, both over US tech companies but also over US foreign policy more generally.'
Entrepreneur
15-05-2025
- Business
- Entrepreneur
Broadcom Set to Surge as AI Diffusion Rule Ends
While NVIDIA and AMD are striking first with new deals after the end of AI Diffusion, Broadcom is waiting in the wings to receive a potentially huge payoff. This story originally appeared on MarketBeat [content-module:CompanyOverview|NASDAQ:AVGO] Over approximately the last three weeks, markets have been on the rise big-time. The S&P 500 closed just under $5,900 on May 14, just around 4% lower than the all-time high it reached in February. As market sentiment shifts, Broadcom (NASDAQ: AVGO), a leading semiconductor stock, has emerged as a top beneficiary. Despite at one point being down nearly 38% in 2025, Broadcom is now just slightly in the green this year as of the May 14 close. The announcement of the trade deal between the U.S. and China boosted the stock. Shares jumped almost 12% within two days after the announcement. However, there were other highly positive recent pieces of news for Broadcom that the trade deal may somewhat overshadow. Most notable is that President Trump is ending the Biden-era "AI Diffusion Rule." Its end has the potential to substantially benefit companies like Broadcom. So, what exactly was the AI Diffusion Rule, and what does its cancellation mean for Broadcom? Understanding the End of AI Diffusion, NVIDIA and AMD See Immediate Benefit The purpose of the AI Diffusion Rule was to give the U.S. government extensive control over which countries can and cannot get access to advanced AI chips made by American firms. Specifically, it controls chips used to train advanced AI models. The rule categorized countries into three different tiers. Tier 1 countries included many of America's closest allies. These countries face no restrictions. Tier 2 countries include most other countries. India, Israel, Singapore, Switzerland, Mexico, Saudi Arabia, and the United Arab Emirates (UAE) were notable inclusions. These countries were limited in the number of chips they could buy. Tier 3 countries, which include adversaries like China and Russia, were not allowed to buy any advanced chips. Really, the government was trying to specifically prevent China and Russia from getting these chips to slow the advancement of their AI capabilities. With the ending of AI Diffusion, that isn't likely to change. However, how the United States treats those Tier 2 countries is changing. NVIDIA's (NASDAQ: NVDA) announcement that it would sell 18,000 of its most advanced chips to Saudi Arabia on the same day the government eliminated the AI Diffusion rule provides evidence of this. Advanced Micro Devices (NASDAQ: AMD) also announced a huge AI partnership in the country. Overall, the end of AI Diffusion means that chip companies with significant AI capabilities now have a much larger opportunity to sell their most advanced technology to these Tier 2 countries. Many of these countries are extremely wealthy, adding to the size of the opportunity. This extends to Broadcom, but in a slightly different way than NVIDIA and AMD. The End of AI Diffusion: Broadcom Waits Its Turn to Capitalize Broadcom's custom chips are largely used for AI model inference, rather than primarily for AI model training. Training comes before inference. For countries like Saudi Arabia, this means they need time to train their models with NVIDIA and AMD chips. After that, Broadcom's chips can really make a difference. [content-module:Forecast|NASDAQ:AVGO] Thus, the fact that NVIDIA and AMD are striking deals opens up the door for Broadcom to sell large amounts of chips to Tier 2 countries down the line. How long that might take is hard to say, but a big opportunity now exists for Broadcom nonetheless. The benefit to Broadcom comes even though the company hasn't expressed concerns about AI Diffusion, at least with a specific set of customers. In the company's last earnings call, Bernstein Research analyst Stacy Rasgon specifically asked about this. Rasgon asked whether AI diffusion would impact Broadcom's design wins or shipments for the three big AI customers the firm is selling to in volume. In response, Broadcom Chief Executive Officer (CEO) Hock Tan said, "To answer your question directly, no, we don't have any concerns." This underscores Broadcom's focus on inference chips, which AI Diffusion did not directly impact. However, they were indirectly impacted because training comes before inference. So, with AI Diffusion ending, the positive impact on Broadcom comes from the expansion of its serviceable market. The End of AI Diffusion Adds Another Broadcom Tailwind For the reasons discussed above, Broadcom can win big due to AI Diffusion ending. Its chips now have a strong path forward to getting into the hands of some of these huge Tier 2 countries. But, cashing in will likely take time. Before you make your next trade, you'll want to hear this. 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Epoch Times
15-05-2025
- Business
- Epoch Times
US Issues Huawei Chips Warning, Signaling New AI Diffusion Rule
The U.S. Department of Commerce's Bureau of Industry and Security (BIS) on May 13 warned entities against using Huawei chips that were developed in violation of U.S. export controls, while announcing that new AI chip trade rules are to come. In January, the outgoing Biden administration finalized an AI Diffusion The BIS on May 13 rescinded the rule, stating it would have burdened American companies with regulations and 'undermined' diplomatic relations with trade partners, and that it would issue a replacement rule at a later date. Under Secretary of Commerce for Industry and Security Jeffery Kessler has instructed BIS enforcement officials to get rid of the AI Diffusion rule, stating that the current administration is writing 'a bold, inclusive strategy to American AI technology with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries.' Huawei and Warnings The United States The May 13 The United States has been setting export controls on Huawei and AI technology to China over the last two administrations, determining that Huawei has ties to the Chinese Communist Party's (CCP) military, which is using the technology for weapons and autonomous systems development, as well as other advancements. Related Stories 5/8/2025 5/7/2025 For years, regulators have warned that sanctioned China-based entities have been finding workarounds like third-party intermediary companies and 'transshipment and diversion' to obfuscate a sanctioned end user to obtain American technology that is off-limits to CCP military affiliates. Exports and Chinese state media reported that Huawei founder Ren Zhengfei told Chinese regime leader Xi Jinping during a closed-door meeting that concerns about U.S. export controls on chips have eased. The Chinese regime has instructed the Chinese tech sector to reach self-sufficiency when it comes to advanced semiconductor technology, and Ren said Huawei's plan to unite 2,000 Chinese companies will help bring them to 70 percent AI Race The United States and communist China's relationship when it comes to the chips market is complex, as both are major buyers and sellers of chips to each other. U.S. export controls on semiconductors have thus far largely targeted China's access to the most advanced chips on the market, with the expectation that this would prevent advanced AI development by the CCP's military. When these rules were issued, semiconductor companies focused on selling larger-sized models to China, with some like Nvidia developing chips In April, the Trump administration announced new restrictions on Nvidia's H20 AI chip, the most advanced chip it currently sells to China, from which Nvidia estimates a loss of $5.5 billion in revenue. ByteDance and Tencent are among the China-based companies that were buying up H20 chips as China made AI advancements. Nvidia CEO Jensen Huang He also said that 'the world has changed significantly' since the previous administration's AI Diffusion rule was released in January and that updated rules are needed 'to accelerate the diffusion of American AI technology around the world.' The White House American chips companies Nvidia, Advanced Micro Devices, and Qualcomm Reuters contributed to this report.
Yahoo
08-05-2025
- Business
- Yahoo
Nvidia 'Welcomes' Trump administration's fresh AI export framework
May 8 - NVIDIA (NASDAQ:NVDA) said it welcomes the Trump administration's move to scrap the AI Diffusion rule, calling the potential repeal a once?in?a?generation opportunity to lead the next industrial revolution and create high?paying U.S. jobs. Warning! GuruFocus has detected 3 Warning Signs with NVDA. The AI Diffusion rule, adopted late in the Biden era, would have capped exports of advanced AI chips to foreign adversaries by sorting countries into three tiers based on strategic risk. It was scheduled to take effect May 15. Bloomberg reported the administration plans to kill the rule as part of a broader rollback of semiconductor export curbs. The repeal isn't final, and uncertainty around timing has left some investors cautious. Bernstein analyst Stacy Rasgon said he expects additional developments around the policy shift but warned that overhang will likely persist until details are clear. We'll take even a temporary reprieve, he wrote, though the issue is probably not put to bed. Based on the one year price targets offered by 50 analysts, the average target price for NVIDIA Corp is $163.43 with a high estimate of $235.92 and a low estimate of $100.00. The average target implies a upside of +38.18% from the current price of $118.28. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-04-2025
- Business
- Yahoo
Nvidia stock drops after Super Micro earnings whiff, Trump looks to change Biden AI trade rule
Nvidia (NVDA) stock fell as much as 3.8% in premarket trade on Wednesday as news from Wall Street and Washington spurred fears of moderating AI demand and tightening chip trade rules from the Trump administration. Nvidia customer Super Micro Computer (SMCI), which makes servers using Nvidia's designs to sell to data center operators and tech firms, cut its revenue and profit outlook for the third quarter — the latest news to signal a wider potential pullback in demand for AI infrastructure. Super Micro shares fell as much as 17% Wednesday before the market open. Tech stocks were also under broad pressure amid a market sell-off spurred by negative news early Wednesday on US economic growth and the state of the labor market. Another challenge for Nvidia stock, according to analysts, is further potential changes from the Trump administration to AI chip export rules. Reuters reported late Tuesday that Trump officials are working to change a Biden-era AI trade rule capping access to US AI chips, potentially making it stricter. Big Tech has called on Trump to scrap the so-called AI Diffusion rule passed by Biden in January during his final days in office, which would restrict chip exports by country using a tiered system. Aside from 18 "key" US allies (i.e. 'tier one'), the rule capped the amount of AI chips that roughly 150 countries can purchase from US companies without obtaining a special license, with the aim of thwarting chip smuggling to China. These "tier two" countries include Israel, Switzerland, and India. 'Tier three' countries such as China, North Korea, and Iran are already blacklisted from the US chip trade. The AI Diffusion rule would go into effect in May. Reuters reported Trump administration officials are weighing discarding the tiered approach and instead using a global licensing regime with government-to-government agreements, making the rule possibly more restrictive. Citi analyst Atif Malik wrote in a note to investors late Tuesday, "these modifications, if true, would be potentially more strict than Biden's as they would put AI chips at the center of tariff negotiations." In Malik's view this would create more uncertainty for the stock. Bernstein's Stacy Rasgon said in his own note the existing rules seemed, in his view, "onerous and capricious... replacing a global framework with individually negotiated bilateral agreements seems clearly worse." Rasgon added, "given increasing decoupling of the US from the rest of the world we see potential risk that such rules open up further opportunities for non-US options like Huawei, who (even though uncompetitive had-to-head) could be seen as more viable if they become the only option available (we are about to see this in China anyway given the recent H20 ban).' Nvidia stock spiraled earlier this month after the US government effectively banned exports of its H20 chips made specifically for the Chinese market to comply with ever-tightening US trade rules. Since then, reports have surfaced that Chinese tech giant Huawei is rushing to fill the gap, introducing a new advanced AI chip reportedly more competitive than Nvidia's prior generation H100 chips. Trump has also set the stage to tariff semiconductors. TD Cowen analysts this week said the administration could introduce semiconductor tariffs of as high as 25% as soon as July. CEO Jensen Huang has courted global leaders amid the rapid deterioration of trade relations between the US, China, and other key trading partners. Huang met with trade officials in China and leaders in Japan earlier this month and asw set to visit DC Wednesday. "It is unfortunate that AI is getting so caught up amid ill-conceived, self-inflicted geopolitical actions given we think AI demand overall remains relatively healthy, and the hardware itself has some shelter from direct tariff effects," Bernstein's Rasgon wrote. The Trump administration has temporarily exempted computing products — including GPUs and servers — from reciprocal tariffs. And as Rasgon previously noted, even if those measures are scrapped, most Nvidia chips are imported in the form of AI servers from Mexico, which are exempt from US tariffs under the USMCA. Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @ Email her at Sign in to access your portfolio
