Trump tells US chip design software makers to halt China sales: Report

According to people with knowledge of the situation, US President Donald Trump’s administration has mandated that US companies that sell their services to Chinese companies.

According to the report, which was released on Wednesday, companies that make electronic design automation software, including Cadence, Synopsys, and Siemens EDA, were instructed by the US Commerce Department to stop providing their tech via letters.

The Commerce Department is reviewing exports of strategic significance to China, according to a spokesperson for the agency, who declined to comment on the letters. “In some cases, Commerce has suspended existing export licenses or required additional licenses while the review is pending.

Cadence’s stock dropped by 10.7% to close, while Synopsys’ stock dropped by 9.6%.

Sassine Ghazi, the CEO of Synopsys, stated in a conference call with analysts that the company had not heard from the Bureau of Industry (BIS) and Security, the Commerce Department’s bureau of industry, which enforces export controls.

“Synopsys has not received a notice from BIS, despite the reporting and speculations that we are aware of. Our guidance for the entire year, therefore, reflects both our current understanding of BIS export restrictions and our expectations for a year-over-year decline in China. Ghazi stated, “We have not received a letter.

Synopsys’ revenue forecast for 2025 was updated after the market closed. After the close, both of its shares and those of Cadence returned 3.5% in trading.

A request for comment was not immediately responded to by Siemens EDA.

These companies use these software to create both premium processors and simpler products.

Although the extent of the policy change described in the report was not immediately known, any decision to defraud Chinese chip design customers could have a negative impact on both their bottom line and their bottom-of-the-barrier customers.

According to a former Commerce Department official, “they are the true choke point,” but that the first Trump administration’s rules on exporting EDA tools to China had been considered before but were ruled out because they were too aggressive.

Synopsys’ annual revenue comes from China, which accounts for about 16% of its revenue, compared to Cadence, which relies on China for about 13%.