Nvidia Hit by AI Chip Ban Fallout as Singapore Tightens Rules

The enforcement of U.S. AI chip export restrictions to China has caused significant disruptions across global supply chains.

Nvidia CEO Jensen Huang called the ban a "failure," citing a drastic decline in Nvidia’s China market share from 95 percent to 50 percent and revealing a $4.5 billion charge and $8 billion in lost orders due to licensing complications. The latest crackdown focuses on Singapore, a vital financial and logistics hub, where authorities are investigating 22 individuals and companies for alleged false representation in chip-related exports. This reflects Singapore’s increasing efforts to balance its global trade role with compliance to U.S. export controls, particularly concerning advanced AI chips.

Key Highlights

• Nvidia lost $8B in orders due to U.S. AI chip export restrictions.
• Singapore investigates 22 entities for possible transshipment fraud.
• AI chip bans target China's military use in intelligentized warfare.

The Singapore government emphasized its stance against the use of local businesses to circumvent restrictions, distinguishing between legitimate billing-based revenue and illegal transshipment practices. Although Nvidia reported 18 percent of revenue from Singapore, actual chip shipments account for less than 2 percent, raising questions about supply chain opacity.

This case underscores how banned components are often rerouted through multiple countries to conceal their final destinations—typically China, where AI chips are believed to support military technologies like radar systems, missile guidance, and secure communications.

Also Read: Nvidia Hit by AI Chip Ban Fallout as Singapore Tightens Rules

The U.S. restrictions aim to halt China’s ambition for “intelligentized warfare,” a strategy prioritizing AI for military superiority. With AI now seen as foundational to cybersecurity and national security, global trade hubs are facing growing pressure to enforce compliance and prevent military-grade AI chips from reaching restricted entities.