Microsoft and Google are apparently circumventing a US embargo. They are renting servers with special processors to Chinese companies.
Microsoft and Google allow Chinese companies access to specialized processors. The two tech giants rent servers outside of China to these customers, as the magazine “The Information” reports, citing insiders.
Nvidia grants access to AI processors
These servers are equipped with processors from the world market leader Nvidia, the report says. These devices are actually not accessible to China due to a US embargo. The USA had restricted the export of high technology in order to slow down the technological and military rise of the People's Republic. Nevertheless, Microsoft and Google are apparently circumventing these restrictions. According to “The Information”, this mainly affects the powerful AI processors from Nvidia.
Trade dispute between USA and China weighs on chip stocks
Just yesterday, it was reported that chip company stocks were sliding worldwide. The background to this is the Biden administration's announcements that it plans to impose stricter export restrictions on chip manufacturing equipment to China. Companies such as ASML, Nvidia and TSMC were hit particularly hard. ASML shares fell by as much as 7.5 percent despite good quarterly figures. CNBC reported that almost half of ASML's sales in the second quarter were in China, which highlights the risk of stricter export restrictions.
Additionally, comments by former President Donald Trump exacerbated the negative sentiment. He called on Taiwan to pay the US for its defense and claimed that Taiwan had captured “approximately 100 percent” of the American semiconductor market. These statements raise questions about the US's future defense policy toward Taiwan. TSMC, the world's largest microchip maker, posted revenues of around $69 billion and net profits of $26.53 billion in 2023.
