Intel, AMD Stocks Fall as China Reportedly Tells Telecom Firms to Phase Out Foreign Chips

Shares of Intel (INTC) and Advanced Micro Devices (AMD) tumbled Friday morning on a report that China has told its telecom companies to phase out chips made outside the country, including those by American companies.

The Wall Street Journal said the order from the Ministry of Industry and Information Technology earlier this year directed China’s biggest telecoms to eliminate foreign processors that are core to their networks by 2027.

The move was aimed at accelerating the country’s effort to cut out those chips, and the Ministry instructed state-owned mobile operators to inspect their networks for non-Chinese semiconductors and put together timelines to replace them, according to the report.

People familiar with the matter told the Journal the decision would affect Intel and AMD the hardest, since the two U.S. firms have provided the bulk of the core processors used in China and the world in recent years. 

Neither Intel nor AMD immediately responded to requests for comment.

Intel shares were down 3.6% at $36.28 as of about 11:45 a.m. ET, while AMD was off 3.8% at $163.96.