Leading Artificial Intelligence (AI) chip maker NVIDIA and rival AMD have agreed to supply hundreds of thousands of advanced AI chips to Saudi Arabia, which had faced export restrictions under U.S. semiconductor regulations. This follows former President Donald Trump's removal of export restrictions on advanced technology to the Middle East as part of his 'business-first' policy. With the complete overhaul of U.S. AI chip export regulations, global business opportunities for U.S. big tech companies like NVIDIA and AMD are expected to expand.
Jensen Huang, CEO of NVIDIA, announced on the 13th (local time) at the 'Saudi-U.S. Investment Forum' in Riyadh that he plans to sell more than 18,000 units of the latest AI chip GB300 Blackwell to the Saudi corporation Humane. Humane is a company established by the Saudi Arabian sovereign wealth funds (PIF).
This announcement coincided with President Donald Trump's visit to Saudi Arabia. NVIDIA plans to collaborate with Saudi sovereign wealth funds to construct what is dubbed an 'AI factory.' CEO Huang said, 'AI requires immense power, and energy-rich Saudi Arabia can harness NVIDIA technology to develop new artificial intelligence capabilities.' Tarek Amin, CEO of Humane, stated that 'we will build a data center with a total capacity of 1.9 gigawatts (GW) by 2030,' which corresponds to the power consumption of more than 2 million households. The project will utilize hundreds of thousands of NVIDIA's advanced chips over the next five years.
AMD also announced that it will supply chips and software for a data center connecting the U.S. and Saudi Arabia at a scale of $10 billion (approximately 13.5 trillion won). For NVIDIA and AMD, this marks a prime opportunity. In the AI chip accelerator market, which has been concentrated among major data center operators like Microsoft (MS) and Amazon, NVIDIA and AMD have been working to expand their customer base. Attracting national-led AI infrastructure projects known as 'sovereign AI' is the goal for both companies. Following the news about the contracts with Saudi Arabia, NVIDIA's and AMD's stock prices rose by 5.63% and 4.01%, respectively, on the New York Stock Exchange.
Starting with this project, the global export paths for NVIDIA and AMD are expected to expand once again. On the same day, the U.S. Department of Commerce officially announced that the Biden administration is withdrawing the 'AI diffusion regulations' and will comprehensively revise AI chip export restrictions. Alternative regulations are expected to be announced later, suggesting that instead of the Biden-style method of controlling AI semiconductor exports based on country ratings, it would likely be replaced by individual government negotiations. While existing measures targeting China will remain in place, it aims to open negotiation opportunities for other countries to purchase U.S. chips. However, additional regulations will be applied to Malaysia and Thailand, which have histories of circumventing chip exports to China. NVIDIA expressed its support, stating, 'With the repeal of this regulation, the U.S. is facing a once-in-a-lifetime opportunity.'
In light of the reforms to AI chip export regulations, the Trump administration is reportedly pushing for a transaction that would allow the United Arab Emirates (UAE) to import more than 1 million of NVIDIA's advanced semiconductors. The primary provision allows the UAE to import 500,000 top-tier chips annually from now until 2027, which is about four times the amount permitted under the previous Biden administration's AI semiconductor export restrictions. In return, the UAE must allocate only one-fifth of the imported top-tier chips to state-owned AI corporations, while supplying the remainder to U.S. corporations constructing data centers in the Gulf region. OpenAI, known for developing ChatGPT, is also considering establishing a new data center in the UAE to expand its presence in the Middle East.