China introduced new regulations to phase out US-made microprocessors, such as those by Intel (NASDAQ:INTC) and AMD (NASDAQ:AMD), from its government computers. This step is part of China's broader effort to enhance its technological independence amidst growing tech tensions with the US, which includes sanctions on Chinese companies and restrictions on the export of advanced chips to China.

Bernstein analysts provided an initial assessment of the impact these Chinese regulations might have, estimating that a complete discontinuation of purchases from the Chinese government could slightly affect revenues but more significantly impact Intel's earnings. According to their preliminary calculations, such measures could reduce overall revenues for Intel and AMD by a low single-digit percentage compared to the current forecasts for fiscal 2024.

This change could result in a mid to low double-digit percentage reduction in Intel's earnings per share (EPS) based on a consensus estimate of about $1.33 for 2024. For AMD, the EPS impact could range from low to mid-single-digit percentages from its consensus estimate of $3.63 for 2024, as per Bernstein's analysis.