Advanced Micro Devices (NASDAQ: AMD) stock fell over 2% in the pre-market trading Monday amid reports of China planning to phase out AMD and Intel (NASDAQ: INTC) chips from government computers.
The Chinese government has initiated a new policy that excludes Intel and Advanced Micro Devices microprocessors from its official computers and servers. This move, reported by the Financial Times, signifies an escalating technological disconnection with the United States.
The latest directive also seeks to curtail the use of Microsoft Windows operating systems and foreign database software. This development follows the prohibition of Apple iPhones in the workplace by numerous Chinese government bodies and state-owned corporations.
This policy is a response to the U.S.-imposed export restrictions on China, aimed at bolstering domestic technology. The United States has prohibited Nvidia and AMD from selling artificial intelligence chips to China and banned advanced chip-making equipment. Furthermore, the U.S. has excluded Huawei telecom equipment and other technologies, urging other nations to follow suit.
The guidelines issued late last year led to the decision to limit chips from Intel (NASDAQ: INTC), AMD, and Microsoft Windows software. These guidelines mandate most government bodies to procure “safe and reliable” processors and operating systems.
Advanced Micro Devices (NASDAQ: AMD) Stock Reaction
AMD stock dropped 2.12% in Monday’s pre-market trading after closing the regular trade at $179.65 on Friday. The traders had exchanged hands with 57,748,149 (57.74 million) shares compared to the average daily trading volume of 77.14 million.
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