White House says scaled-down AI chips for China won’t be allowed

The White House has notified federal departments that Nvidia will not be allowed to sell its scaled‑down B30A AI chip to China, according to a report from The Information.

The B30A was created to meet earlier export limits while still being able to train large language systems when many units are combined.

Nvidia had already provided sample units to several Chinese companies that wanted to use them in data centers for AI work.

A spokesperson for Nvidia, speaking to Reuters, allegedly said the company has “zero share in China’s highly competitive market for datacenter compute, and do not include it in our guidance.”

The B30A had been viewed by Chinese firms as a workaround option after higher‑end chips were restricted. Those companies used clusters of lower‑capacity hardware to train advanced systems. The U.S. decision blocks that path entirely.

The decision also applies to new construction and ongoing state‑backed expansion projects. It also covers government‑supported cloud infrastructure and research computing clusters. The objective is to increase reliance on domestic semiconductor firms and limit any dependency on foreign accelerators, especially accelerators tied to AI development. The new rule frameworks were discussed among Chinese data center operators throughout the week.

Nvidia works on design changes while Beijing imposes new rules

Two employees at Nvidia reportedly said the company has been working on another revision of the B30A to see if the administration will approve a different configuration.

The company has redesigned chips multiple times over the past two years in response to U.S. export controls, but this time, approval is uncertain.

The chip is manufactured in the United States and Taiwan, and distribution was intended to meet existing restrictions.

At the same time, Beijing has introduced new rules that force all state‑funded data centers to use only locally developed processors.

According to The Information, data centers that are less than 30% completed must remove any foreign chips that have already been installed or cancel any plans to purchase them.

Facilities at later stages will be assessed one by one, and continued foreign hardware usage will require separate approval.

Stock market pulls back as tech earnings season ends amid government shutdown

The announcement came on a trading day where U.S. markets were reacting to quarterly earnings reports. The S&P 500 fell 1.1%, the Dow Jones Industrial Average dropped 421 points, equal to 0.9%, and the Nasdaq index declined 1.8% by midday.

Large technology firms weighed down the overall market due to their high index weighting. Nvidia shares fell by as much as 4.2%. Microsoft shares declined 1.9%, and Amazon shares dropped 2.4%.

Corporate results have taken on increased importance because the government shutdown has paused the release of several key economic indicators. That includes inflation numbers, consumer spending reports, and job market data.

Without those indicators, investors have been relying on company earnings calls and forward guidance to assess conditions.

The shutdown has already delayed the monthly employment data for September, and the October report will also not be released if the shutdown continues. The release of consumer price information for October is also at risk of being postponed.

Among other notable stock moves, DoorDash declined 15.2% after telling investors it expects higher development costs next year.

Datadog rose 20.1% after reporting quarterly revenue and net income that exceeded expectations. Rockwell Automation increased 3.9% after reporting results that also beat analyst estimates.

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