Nvidia Slams Amazon-Backed Anthropic Over Support For Stricter China Chip Bans, Mocks 'Tall Tales' Of Smuggling With Live Lobsters And 'Baby Bumps'

On Thursday, in a rare and sharp public clash, NVIDIA Corp. NVDA targeted artificial intelligence startup Anthropic, which is backed by Amazon.com, Inc. AMZN and Alphabet Inc. GOOG GOOGL for supporting tighter U.S. restrictions on AI chip exports to China.

What Happened: Nvidia slammed Anthropic following the startup's blog post urging stricter enforcement of U.S. chip export controls. Anthropic stated that AI chips have been smuggled into China hidden in "prosthetic baby bumps" and "packed alongside live lobsters," reported CNBC.

The post cited the 2022 arrest of a woman caught transporting chips and a 2023 seizure involving computer display cards found in a lobster shipment in Hong Kong.

See Also: Nvidia’s Jensen Huang Meets Japanese PM To Discuss AI’s Growing Energy Needs

"American firms should focus on innovation and rise to the challenge, rather than tell tall tales that large, heavy, and sensitive electronics are somehow smuggled in ‘baby bumps' or ‘alongside live lobsters,'" a spokesperson for Nvidia said in a statement, according to the report.

A spokesperson for Anthropic responded to Nvidia's criticism, saying the company "stands by its recently filed public submission in support of strong and balanced export controls that help secure America's lead in infrastructure development and ensure that the values of freedom and democracy shape the future of AI," the report added.

Why It's Important: On the same day, Nvidia CEO Jensen Huang reportedly told U.S. lawmakers that current AI chip export restrictions could be unintentionally giving China's Huawei Technologies a stronger position in the global race for AI dominance.

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Last month, the U.S. government blocked Nvidia from selling its H20 chip — a product specifically tailored for the Chinese market — shortly after initial shipments had begun.

As a result, Nvidia expects to incur a $5.5 billion hit in the first quarter ending April 27, related to inventory and purchase obligations for the now-restricted chip.

Price Action: Nvidia shares rose 2.47% on Thursday, closing at $111.61, according to Benzinga Pro.

Benzinga Edge Stock Rankings gives Nvidia a strong growth score of 94.78%. Click here to see how it compares to other leading tech stocks.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.