Chip software stocks sink on report Trump ordered halt to China sales | CDNS stock | SNPS stock

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Chip software stocks sink on report Trump ordered halt to China sales

Published Wed, May 28 20253:26 PM EDTUpdated 5 Min Ago

Key Points

• Cadence and Synopsys saw their shares move lower in Wednesday trading on a Financial Times report saying a division of the U.S. Commerce Department told them to stop selling to organizations in China.
• The federal agency warned U.S. companies about using artificial intelligence chips from China’s Huawei earlier this month.

 Shares of chip design software makers Cadence

 and Synopsys tumbled in Wednesday trading after The Financial Times reported that the White House told them to stop selling to clients in China.

The Bureau of Industry and Security under the U.S. Commerce Department sent letters to both companies and to Siemens, the newspaper said.

Synopsys declined to comment. Cadence and Siemens representatives did not immediately respond to requests for comment.

The report follows the Trump administration’s decision to get rid of a rule to limit the export of artificial intelligence processors to China. Nvidia celebrated the change. But it’s not clear how forthcoming policy from administration might affect Nvidia’s business. Nvidia reports results after the bell on Wednesday.

Earlier this month the Bureau of Industry and Security issued a warning about using Huawei Ascend AI chips, saying organizations that adopt them could be subject to enforcement action. A spokesperson for China’s Ministry of Commerce said the move undermined the two countries’ preliminary trade agreement and demanded that the White House “correct its mistakes.”