The actions of Nvidia sinks almost 4% this Monday, as the chipmaker opposes a last-minute attempt by the Biden administration to impose new regulations on the artificial intelligence (AI). The company issued an explicit request to the president-elect donald trump to reject such policies.
Nvidia sharply criticized the Biden administration and praised Trump in a press release Monday, responding to new export restrictions targeting the company’s coveted AI chips. This criticism coincided with a rare bearish streak on Wall Street for Nvidia and growing support in Silicon Valley for Trump.
Nvidia shares fell as much as 4.7% to $129.51 shortly after the market opened, as pressure on its international business intensified the recent drop in its price.
Biden’s measures
President Joe Biden on Monday announced a regulatory framework to control the transfer of AI technology, designed primarily for Nvidia, with the goal of limiting foreign sales of AI chips at both the country and company levels.
The White House justified the move as an effort to keep advanced AI systems out of the hands of “countries of concern,” expressing concern about China’s use of American technology during its administration.
The potential for export restrictions poses a challenge for Nvidia, as China, Singapore and Taiwan accounted for more than half of its $35 billion in revenue in the latest financial quarter, with China contributing $5.4 billion. .
In a strongly worded statement, Nvidia rejected the new rules: “Biden’s new regulations will only weaken America’s global competitiveness, undermining the innovation that keeps us ahead,” said Ned Finkle, Nvidia’s vice president of government affairs, arguing that It is an attempt by the White House to “manipulate market outcomes and stifle competition.”
Nvidia’s statement also reflected a favorable attitude toward Trump, highlighting that “the first Trump administration laid the groundwork” for the recent AI revolution. Finkle added: “We look forward to the return of policies that strengthen American leadership, boost our economy, and preserve our competitive advantage in AI and beyond.”
Nvidia shares fell as much as 4.7% to $129.51 shortly after the market opened, as pressure on its international business intensified the recent drop in its price.
The stock had retreated more than 15% from its all-time high the previous week, erasing up to $578 billion in market capitalization from its peak valuation of $3.75 trillion. Other big tech companies also face difficulties on Monday: Alphabet, Apple and Tesla recorded drops of at least 1%while the S&P 500 index reached its lowest level since early November.
In contrast
Much of the increase in Nvidia’s value occurred during the Biden administration. The company’s shares have risen 880% since Biden’s inauguration in 2021, compared with a 414% increase during Trump’s first term, according to FactSet data.
Nvidia is not the first big tech company to show enthusiasm for a possible second Trump term. Amazon and Alphabet They pledged $1 million to Trump’s inaugural fund, while industry leaders such as Mark Zuckerberg (Meta), Tim Cook (Apple) and Jeff Bezos (Amazon) met with him after his election victory.
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Image created with artificial intelligence
Zuckerberg announced major changes to Meta’s policies ahead of Trump’s inauguration, eliminating fact checks in favor of X-style community notes, and adding Trump ally Dana White to its board of directors. The Trump administration also created the position of “AI and Crypto Czar” in the White House, filled by venture capitalist David Sacks, with the goal of making the United States “the clear global leader” in AI and cryptocurrencies, according to Trump in December.
Nvidia remains the face of the generative AI boom in the 2020s, designing much of the data-intensive hardware and software used to train AI technologies like OpenAI’s ChatGPT and Tesla’s self-driving programs.
Source: Ambito
