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AI Leaders Urge U.S. to Boost Exports and Infrastructure to Stay Ahead of China

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Top executives from OpenAI, Microsoft, and AMD warned U.S. lawmakers on Thursday that the country risks losing its lead in artificial intelligence to China unless it expands infrastructure, loosens AI chip export restrictions, and strengthens workforce training. Their testimony before the U.S. Senate Commerce Committee, chaired by Senator Ted Cruz, emphasized the urgent need for pro-growth AI policies to counter China’s rapid advancements.

The call to action follows China’s DeepSeek AI breakthrough last year and Huawei’s rollout of advanced AI chips, both of which have shaken Washington’s confidence in maintaining AI dominance.

“The number-one factor that will define whether the U.S. or China wins this race is whose technology is most broadly adopted in the rest of the world,” said Brad Smith, President of Microsoft. He added that Microsoft has banned internal use of DeepSeek due to data privacy and propaganda concerns.
“The lesson from Huawei and 5G is that whoever gets there first will be difficult to supplant.”

Key Takeaways from the Senate Hearing:

  • OpenAI CEO Sam Altman emphasized the need for massive infrastructure investment, including data centers and power generation, to fuel AI’s growth.

  • AMD CEO Lisa Su highlighted the importance of maintaining competitiveness in AI chip design while also ensuring export flexibility.

  • Smith called for broader AI education, R&D funding, and skilled labor development, including more electricians for AI facilities.

The tech industry is pushing back against Biden-era AI export rules that aimed to limit China’s access to powerful AI chips. In response, the Trump administration is preparing to rescind those curbs and replace them with a new framework — a move praised by Cruz, Altman, and Su during the session.

“The Biden administration’s misguided midnight AI diffusion rule on chips and model weights would have crippled American tech companies’ ability to sell AI to the world,” Cruz said.

China’s DeepSeek, based in Hangzhou, made waves by launching a powerful, cost-effective AI model competitive with OpenAI and Meta — a move that intensified pressure on U.S. lawmakers to act quickly.

Meanwhile, Huawei is preparing to mass-ship advanced AI chips to Chinese customers despite ongoing U.S. trade restrictions.

With national security, economic leadership, and technological supremacy at stake, AI executives stressed that global market penetration—not just technical capability—will determine who wins the AI race.

AMD Warns of $1.5 Billion Revenue Hit from U.S. China Chip Export Curbs, But AI Demand Remains Strong

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Advanced Micro Devices (AMD) warned on Tuesday that new U.S. restrictions on AI chip exports to China will cost the company $1.5 billion in revenue for 2025, as Washington intensifies efforts to limit China’s access to advanced technology. Despite the projected hit, AMD’s second-quarter revenue forecast surpassed Wall Street expectations, buoyed by early chip purchases from customers bracing for trade disruptions.

The Biden and Trump administrations have both ramped up controls on exports of high-performance chips to China, citing national security risks related to AI capabilities. These measures now require chipmakers like AMD and Nvidia to obtain export licenses, effectively slowing or blocking shipments of advanced processors.

CEO Lisa Su said most of the export-related impact will be felt in Q2 and Q3, but expressed confidence in broader business strength. “It’s certainly a headwind, but one which we think is well contained,” Su said, noting that AI chip revenue in AMD’s data center segment is expected to grow by “strong double digits” this year.

China represents about 25% of AMD’s total revenue, and the export curbs are expected to shave nearly 5% off 2025 revenue projections, which currently sit at $31.03 billion, per LSEG data.

In Q1, AMD reported:

  • Total revenue of $7.44 billion, up 36% year-over-year, beating the estimate of $7.25 billion

  • Adjusted earnings of 96 cents per share, 2 cents above consensus

  • Data center revenue surged 57% to $3.7 billion, above the $3.62 billion estimate

For Q2, AMD expects revenue of $7.4 billion ± $300 million, also ahead of forecasts. However, the company is still absorbing an $800 million charge due to April’s newly enacted tariffs.

CFO Jean Hu confirmed the $1.5 billion forecasted revenue loss is tied directly to the latest April export controls. Analysts suggest the current surge in orders reflects “pre-buying behavior” from large cloud clients like Microsoft and Meta, who are stockpiling chips ahead of licensing uncertainty.

“Once those safety-stock closets are full, Q3 could feel like the morning after a Red Bull binge,”
warned Michael Schulman, CIO at Running Point Capital.

Meanwhile, rivals Marvell Technology and Super Micro both disappointed investors, citing economic uncertainty and reduced AI-related optimism. Their shares fell 4.5% and 5%, respectively, in after-hours trading.

AMD’s solid results highlight its growing role in powering AI infrastructure for hyperscalers, even as trade tensions and tariffs loom over the semiconductor industry.

AMD Shares Drop as CEO Forecasts Declining Data Center Sales Amid AI Competition

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Shares of Advanced Micro Devices (AMD) plunged around 10% in after-hours trading on Tuesday after the chipmaker provided a disappointing forecast for its data center sales, particularly in the AI market. Despite exceeding quarterly revenue expectations, AMD’s outlook for 2024 failed to reassure investors, who have been anticipating the company’s larger push into AI, an area dominated by Nvidia.

AMD reported fourth-quarter data center revenue of $3.9 billion, missing the analyst consensus estimate of $4.15 billion. This segment is considered a key indicator of AMD’s AI revenue, as it includes sales of processors that compete with Nvidia’s chips. For 2024, the company reported generating over $5 billion in AI chip revenue but projected a 7% decline in data center sales for the current quarter. AMD’s CEO, Lisa Su, did not provide specific projections for AI chip sales but expressed confidence in achieving “tens of billions” in revenue over the coming years.

However, analysts, such as Kinngai Chan from Summit Insight, suggested that AMD’s AI GPU performance was not meeting market expectations. Meanwhile, Nvidia continues to lead the AI chip market with an 80% share, bolstered by its proprietary CUDA software, which remains a significant barrier for AMD to overcome. Competitors like Microsoft and Meta have also been developing their own custom AI chips, further intensifying the competitive landscape.

Despite these challenges, AMD is focusing on collaborations with its customers to create custom AI chips, aiming to close the gap with companies like Marvell and Broadcom. AMD remains optimistic about increasing sales of personal computer chips, as demand for PCs capable of handling generative AI tasks shows signs of recovery after a prolonged slump.

AMD’s forecasted first-quarter revenue of approximately $7.1 billion, slightly above analyst estimates, provided some relief, but the company’s position in the highly competitive AI chip market remains a point of concern for investors.