Intel is one of the largest semiconductor chip manufacturers by revenue Credit: Jonathan Raa/NurPhoto via Getty Images

Intel will release two AI chips with reduced capabilities in China as the semiconductor industry bends to comply with US export controls. 

The two chips, named HL-382 and HL-388, are scheduled for launch respectfully in June and September, according to The Register. 

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Intel’s China-specific AI chips are based on its Gaudi 3 product line but have had their performance significantly reduced to comply with export control regulations. 

Nvidia also has plans to release three reduced capability chips for the Chinese market.

The US has been working to solidify its domestic production of semiconductors by introducing new trade controls that limit the export of sensitive technology needed in chip production. 

Domestic production is also being boosted by the US CHIPS Act, implemented by US President Joe Biden’s administration, which provides millions of dollars worth of manufacturing incentives. 

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Intel has been awarded up to $8.5bn in CHIPS Act funding, which the company said it will spend on fabs and research centres in Arizona, Ohio, New Mexico and Oregon.

GlobalData predicts that the AI arms race in 2023, which saw companies rush to create their own large language models, will transition to the ‘AI chip race’ in 2024.

This will be seen not only in Big Tech companies but also among start-ups as they look to create their own proprietary chips, according to the report.

GlobalData forecasts that the overall AI market will be worth $909bn by 2030, registering a compound annual growth rate (GAGR) of 35% between 2022 and 2030.

In the GenAI space, revenues are expected to grow from $1.8bn in 2022 to $33bn in 2027 at a CAGR of 80%.