July 14 (Reuters) – In a bid to discuss China policy and address concerns regarding market conditions and export controls, the chief executives of Intel Corp (INTC.O) and Qualcomm Inc (QCOM.O) are reportedly planning to visit Washington next week, according to sources familiar with the matter. The executives aim to engage in meetings with U.S. officials, although it remains unclear which officials they will be meeting with at this time.
The potential visits of other semiconductor CEOs to Washington next week have also been mentioned by the sources, who chose to remain anonymous as they were not authorized to speak to the media. Intel and Qualcomm declined to provide comments, and a request for comment from White House officials went unanswered.
This development comes in the context of U.S. officials considering the tightening of export rules that could impact high-performance computing chips and shipments to Huawei Technologies Co Ltd, as reported by Reuters in June. These rules would potentially affect Intel, which is in the process of preparing a new artificial intelligence chip for potential shipment to China, as well as Qualcomm, which currently holds a license to sell chips to Huawei.
It is worth noting that the Biden administration had previously issued comprehensive rules in October of the previous year with the aim of freezing China’s semiconductor industry’s progress while simultaneously providing substantial subsidies to bolster the U.S. chip industry.
Nvidia is a company that stands to be significantly affected if these rules are tightened. The company’s substantial presence in the AI chip market had contributed to its valuation reaching $1 trillion earlier this year.
In recent years, the chip industry has received favorable attention in Washington, with lawmakers and the White House actively promoting the shift of production away from China and towards the U.S. and its allies. Both Intel CEO Pat Gelsinger and Qualcomm CEO Cristiano Amon have frequently engaged with government officials in meetings.
The upcoming meetings scheduled for next week, which may potentially involve joint sessions between executives and U.S. officials, come at a time when chip companies, including Nvidia Corp (NVDA.O), are concerned about a permanent loss of sales due to escalating tensions between Washington and Beijing, particularly in a market heavily reliant on business from China.
According to one of the sources familiar with the matter, the primary objective of the executives during these meetings is to ensure that government officials fully comprehend the potential consequences of further tightening the rules pertaining to chip sales to China.
Many U.S. chip companies generate more than 20% of their revenue from China, and industry leaders argue that any reduction in these sales would have a negative impact on profits, which are subsequently reinvested into research and development efforts.
Reporting by Andrea Shalal in Washington, Stephen Nellis in San Francisco, and Karen Freifeld in New York; Editing by Chris Sanders and Edmund Klamann