Forbes analysis argues that ongoing export controls are inflicting structural losses on Nvidia, AMD, and Intel that extend far beyond direct revenue foregone from restricted markets.
News from China continues to reveal the damage of export controls foisted on U.S. chipmakers by the Biden administration. The controls have, in varying ways, remained in place under the second Trump administration, only to be reinforced by Senators Elizabeth Warren (D-MA), Jim Banks (R-IN), Chuck Schumer (D-NY), and Tom Cotton (R-AR).
American chipmakers like Nvidia, AMD, Intel, and others are being handed the bill for these needless market intrusions, though in ways well beyond lost sales. In a very real sense, to focus solely on near-term revenue declines is to miss the much larger, long-term consequence.
Still, to grasp the long-term damage of export controls, it is useful to begin with the immediate sales impact. Before the last two presidential administrations and Congress broadly adopted protectionism and industrial policy as national security strategies, Chinese technology corporations were major buyers of U.S.-produced chips. It is not just that they were and remain the best purchasers; it is the brand elevation inside China and around the world that comes with having American genius embedded in your product.
The previous state of commercial play was precisely what the Chinese Communist Party (CCP) did not want. Its members, like segments of the U.S. political class, view trade as war rather than what it actually is: the antidote to conflict born of the prosperous division of labor. Consequently, the actions of the Biden administration and those that followed played directly into Beijing’s hands.
Fast forward to the present. A recent report in the South China Morning Post indicated major growth for top Chinese semiconductor companies. More specifically, surging sales for Hua Hong Grace Semiconductor and Semiconductor Manufacturing International Corporation increased profits by 385% and 267%, respectively, in the second quarter “amid a spike in demand for domestic artificial intelligence chips free of U.S. export controls.”
With an eye toward evenhandedness regarding the sales and profit surge, some of this growth was inevitable. Success naturally begets imitators eager to compete away profits. In other words, global excitement about artificial intelligence (AI) and its extraordinary potential was going to result in increased global competition for Nvidia, AMD, and Intel regardless of policy. But as the title of this piece indicates, the worst damage cannot be measured in sales, or the lack thereof.
To understand why, consider how the best salespeople interact with customers. It is not about units moved; rather, it is about sales rooted in consultation. It is about genuinely grasping how products and services can help clients prosper over time. The best salespeople are not the best talkers; they are the best listeners. By learning customer needs, they not only determine how best to integrate their offerings into client operations, but they also develop a sense of what customers will eventually require.
Which means lost sales are merely headlines that miss the bigger story. As unreliability rooted in political uncertainty enters the lexicon surrounding world-leading American chipmakers, the need for alternative suppliers grows. Consequently, Nvidia and its peers do not just miss out on revenue; they miss out on crucial and evolving customer knowledge that can only be attained through deep relationships. These relationships deepen not merely from closing deals, but from understanding precisely how sold products and services are used, how they fall short, how they exceed expectations, and where they do not.
To reduce the shame of export controls to lost sales is to insult the seriousness of the sales process. The latter is about relationships built over substantial time spent together. Political error means less of what is truly valuable, resulting in long-term losses that cannot be easily calculated.