Microsoft and AMD develop new gaming chips

Microsoft plans to equip its next-generation Xbox console with AI-focused hardware, including a dedicated neural processing unit.

Vice President Jason Ronald confirmed that the company is working with AMD to develop chips for gaming consoles, PCs and cloud platforms.

New AI capabilities are expected to transform gameplay and provide developers with tools to create immersive, previously unattainable experiences.

Microsoft’s experimental Xbox Ally X device, developed with ASUS, is already used to test AI integration in real-world scenarios.

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Sam Altman urges rethink of US–China AI strategy

OpenAI CEO Sam Altman has warned that the United States may be underestimating China’s rapid advances in AI. He argued that export controls on semiconductors are unlikely to be a reliable long-term solution to the global AI race.

At a press briefing in San Francisco, Altman said the competition cannot be reduced to a simple scoreboard. China can expand inference capacity more quickly, even as Washington tightens restrictions on advanced semiconductor exports.

He expressed doubts about the effectiveness of purely policy-driven approaches. ‘You can export-control one thing, but maybe not the right thing… workarounds exist,’ Altman said. He stressed that chip controls may not keep pace with technological realities.

His comments come as US policy becomes increasingly complex. President Trump halted advanced chip supplies in April, while the Biden administration recently allowed ‘China-safe’ chips, requiring Nvidia and AMD to share revenue. Critics call the rules contradictory and difficult to enforce.

Meanwhile, Chinese firms are accelerating efforts to replace US suppliers, with Huawei and others building domestic alternatives. Altman suggested this push for self-sufficiency could undermine Washington’s goals, raising questions about America’s strategy in the AI race.

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Nvidia prepares new AI chip for China amid Washington’s hesitation

As if Trump’s recent shifts in chip export policy regarding the scaled-down chip models were not enough to reopen supply to the Chinese market, after all the earlier tariffs and bans, Nvidia is now quietly developing a new AI chip for China, even as Washington continues to debate how much cutting-edge US technology Beijing should be allowed to access.

According to Nvidia’s latest statements, the chip, codenamed B30A, will be based on Nvidia’s latest Blackwell architecture and is expected to outperform the company’s current China-approved model, the H20.

Namely, the novelty comes just days after President Donald Trump weighed permitting scaled-down versions of Nvidia’s most advanced chips to be sold in China. His comments marked a potential shift in US policy, but the approval remains uncertain, with lawmakers in both parties warning that even weaker versions of top-end chips could still give Beijing an edge in the global AI race.

Technically, the B30A will be less potent than Nvidia’s flagship B300, but it retains advanced features such as high-bandwidth memory and NVLink connectivity, which are crucial for fast data processing.

Nvidia hopes to send early samples to Chinese customers next month, though final specifications have yet to be confirmed.

‘Everything we offer is with full government approval and designed for commercial use,’ the company said in a statement.

The stakes are high, as China accounted for 13% of Nvidia’s revenue last year, and losing that market could push customers toward domestic rivals like Huawei.

Analysts note that Huawei’s chips are improving, particularly in raw computing power, though they still lag in software support and memory performance, areas where Nvidia remains dominant.

At the same time, Beijing has been pushing back. Chinese experts recently raised concerns that Nvidia’s chips could pose security risks, and regulators have reportedly warned Chinese tech firms about buying the H20.

Nvidia denies any such vulnerabilities, but the warnings illustrate how political friction is weighing on commercial strategy.

Alongside the B30A, Nvidia is also preparing another chip, the RTX6000D, built for AI inference rather than training. That model has weaker specifications designed to comply with strict US export thresholds.

Nvidia plans to start shipping small batches of the RTX6000D to Chinese clients as early as September, which seems to indicate that the company is trying to balance Washington’s restrictions with the need to preserve its foothold in one of the world’s most lucrative AI markets.

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SoftBank invests $2 billion in Intel to boost US semiconductor industry

Japanese technology giant SoftBank has announced plans to buy a $2 billion stake in Intel, signalling a stronger push into the American semiconductor industry.

The investment comes as Washington debates greater government involvement in the sector, with reports suggesting President Donald Trump is weighing a US government stake in the chipmaker.

SoftBank will purchase Intel’s common stock at $23 per share. Its chairman, Masayoshi Son, said semiconductors remain the backbone of every industry and expressed confidence that advanced chip manufacturing will expand in the US, with Intel playing a central role.

The move follows SoftBank’s increasing investments in the US, including its role in the $500 billion ‘Stargate’ AI project announced earlier this year.

Once a dominant force in Silicon Valley, Intel has struggled against rivals such as Nvidia and AMD. Under new CEO Lip-Bu Tan, the company is cutting 15% of its workforce and reducing costs to stabilise operations.

After a private meeting, Trump recently criticised Tan’s leadership but later softened his stance.

Shares in both companies slipped following the announcement, with SoftBank down 2.2% in Tokyo and Intel falling 3.7% in New York.

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US may take stake in Intel to boost chip production

The US government is reportedly considering acquiring a stake in Intel to support its domestic chip manufacturing plans. Talks began after Intel CEO Lip-Bu Tan met with Trump administration officials on 11 August, following calls for his resignation over alleged China ties.

President Trump has pushed for greater control over the semiconductor sector and recently criticised Tan, prompting political pressure on Intel’s board.

While Intel declined to comment on a possible deal, it stated its commitment to supporting US technology and manufacturing leadership.

The proposed stake would aid Intel’s delayed Ohio chip factory project and expand its US production capacity.

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DeepSeek delays next AI model amid Huawei chip challenges

Chinese AI company DeepSeek has postponed the launch of its R2 model after repeated technical problems using Huawei’s Ascend processors for training. The delay highlights Beijing’s ongoing struggle to replace US-made chips with domestic alternatives.

Authorities had encouraged DeepSeek to shift from Nvidia hardware to Huawei’s chips after the release of its R1 model in January. However, training failures, slower inter-chip connections, stability issues, and weaker software performance led the start-up to revert to Nvidia chips for training, while continuing to explore Ascend for inference tasks.

Despite Huawei deploying engineers to assist on-site, DeepSeek was unable to complete a successful training run using Ascend processors. The company is also contending with extended data-labelling timelines for its updated model, adding to the delays.

The situation underscores how far Chinese chip technology lags behind Nvidia for advanced AI development, even as Beijing pressures domestic firms to use local products. Industry observers say Huawei is facing “growing pains” but could close the gap over time. Meanwhile, competitors like Alibaba’s Qwen3 have integrated elements of DeepSeek’s design more efficiently, intensifying market pressure.

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South Korea unveils megagrowth plan with AI expressway and energy reform

President Lee Jae-myung has announced a sweeping national megagrowth plan that positions South Korea at the forefront of AI and energy transformation.

The initiative includes the creation of an ‘AI expressway’, starting with the Ulsan AI data centre, underpinned by bold tax incentives and regulatory reforms to attract private sector investment. Complementing this is a proposed investment of 100 trillion won to accelerate AI innovation, next-generation semiconductors, and the development of AI infrastructure and innovation zones.

On the energy front, the government has launched a dedicated task force to develop an AI-powered next-generation power grid. This ‘electric highway’ aims to integrate AI technology into renewable energy distribution and grid modernisation without needing vast new infrastructure.

Complementing the power grid overhaul, Korea Electric Power Corp. (KEPCO) plans to invest around 73 trillion won by 2038 to expand transmission lines and upgrade the power infrastructure serving major semiconductor complexes.

Together, these measures form a robust blueprint that aligns digital transformation with energy security, aimed at keeping South Korea globally competitive while responding to rising electricity demands from AI and other tech industries.

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India must ramp up AI and chip production to meet global competition

At the Emkay Confluence in Mumbai, Chief Economic Adviser V. Anantha Nageswaran emphasised that while trade-related concerns remain significant, they must not obscure the urgent need for India to boost its AI and semiconductor sectors.

He pointed to AI’s transformative economic potential and strategic importance, warning that India must act decisively to remain competitive as the United States and China advance aggressively in these domains.

By focusing on energy transition, energy security, and enhanced collaboration across sectors, Nageswaran argued that India can strengthen its innovation capacity and technological self-reliance.

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Nvidia holds record share of S&P 500

Nvidia now accounts for more than 8% of the S&P 500, the largest share ever held by a single stock since records began in 1981. The company’s market value reached about $4.5 trillion on Monday, driven by unprecedented demand for its AI chips.

Its share price surged 239% in 2023, 171% in 2024, and 36% in 2025.

While investor sentiment remains strong, analysts warn of mounting risks. Political tensions with China, potential export restrictions, and reliance on overseas resellers could threaten sales.

Over the weekend, reports emerged of an agreement with the US government allowing Nvidia and AMD to give 15% of Chinese chip revenue in exchange for export licences, potentially boosting growth by more than 20%.

Infrastructure is another concern. Analysts say customers now face delays from chip shortages, limited power grid capacity, and data centre cooling systems.

Some of Nvidia’s biggest clients could become direct rivals, challenging its 75% profit margin and long-term dominance in AI infrastructure.

Nvidia’s unprecedented weight in the S&P 500 closely ties the index’s performance to its fortunes. While demand for AI hardware remains high, the company’s growth trajectory depends on navigating political, infrastructure, and competitive pressures.

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China pushes back on Nvidia chip sales, undercutting Trump’s proposed export deal

China is quietly urging domestic companies to steer clear of Nvidia’s H20 processors, especially for government or security-related projects, throwing a wrench into US efforts to turn those sales into a revenue source for Washington.

Over recent weeks, Chinese authorities have sent private notices to firms questioning their reliance on US chips and promoting domestic alternatives.

The guidance comes just as Nvidia and AMD gained approval from the Trump administration to resume selling certain AI chips to China, under a rare arrangement that requires the companies to share 15% of related revenue with the US government.

While the directive stops short of an outright ban, Beijing has placed the H20 under the same kind of partial restrictions previously imposed on Tesla vehicles, Apple iPhones, and Micron chips, citing security concerns.

Officials have floated fears that Nvidia hardware could carry location-tracking or remote shutdown features, claims the company firmly denies. At the same time, China is accelerating efforts to boost its homegrown semiconductor industry, urging firms to shift away from Western technology in favour of local suppliers, such as Huawei, even though domestic capacity still falls short of market demand.

The campaign highlights a broader geopolitical irony: US officials defended the resumption of H20 exports by arguing that the chip was already widely available in China and technologically inferior to top US models.

Trump has called it ‘obsolete,’ framing the sales as a way to keep Chinese AI systems dependent on American-made, less advanced hardware.

Behind the scenes, officials have linked the deal to a broader trade arrangement involving Chinese rare-earth minerals, though Beijing has publicly denied any such quid pro quo.

For Nvidia, the H20 remains strategically important. Although less potent than its flagship Blackwell series, the chip’s high memory bandwidth makes it well-suited for AI inference, a crucial stage in which models interpret and respond to data.

Chinese tech giants like Alibaba and Tencent have sought the H20 to offset supply shortages from Huawei, which is struggling to produce enough advanced chips to meet domestic demand.

Analysts warn that losing access to the H20 could raise the cost of running AI models in China by up to six times.

Still, Beijing’s stance appears to be a balancing act. RAND researcher Lennart Heim notes that China uses regulatory pressure to channel demand toward Huawei without cutting off access to Nvidia products, ensuring that companies can still meet their needs while domestic capabilities mature.

However, the Chinese government’s selective pressure could deepen uncertainty for US chipmakers counting on China, the world’s largest semiconductor market, to offset lost sales elsewhere.

While Washington’s new export-for-revenue-sharing model is already unprecedented, Beijing’s countermeasures show that even approved sales may face political headwinds.

For Nvidia and AMD, the challenge is no longer just securing US permission, but also convincing China to buy.

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