As the Battle for AI Supremacy Intensifies, the US Curbs Exports of AI Chip Design Software to China

In a high-tech twist to the ongoing US-China trade war, the Trump administration has imposed fresh restrictions on exports of semiconductor design software - a critical tool for developing sophisticated AI chips - to China. This strategic maneuver, intended to stifle China’s burgeoning AI prowess, has triggered significant ramifications within the global technology sector. Big names such as Siemens EDA, Cadence Design Systems, and Synopsys have all received notices from the US Commerce Department, heralding a new era of export controls on electronic automation design (EDA) software.

The ripple effect has touched upon US-based Synopsys, another provider of EDA software. Synopsys confirmed receipt of a similar letter from the Bureau of Industry and Security (BIS) and promptly suspended its forecast for the third quarter and the entirety of 2025. Cadence also received a notice from BIS, informing them that a license is now required for the export or in-country transfer of electronic design automation software to its customers in China.

This tightening of export rules resonates with the US’s intensified efforts to undermine Chinese tech firms within the ongoing battle for AI dominance. However, these restrictions are not without a significant blowback. The US chip industry, which has enjoyed substantial market share in China, is feeling the brunt of these decisions. Nvidia, for instance, has seen billions in losses due to constraints on the sales of its H20 and Hopper AI chips to Chinese clients. AMD has also been affected, with both tech giants allegedly considering the sale of lower-powered versions of their AI chips to circumvent the restrictions.