This article first appeared on GuruFocus.
According to Reuters, Broadcom (NASDAQ: AVGO) shares fell about 5% on Wednesday after reports that Chinese authorities asked local companies to stop using certain U.S. and Israeli cybersecurity software due to national security concerns.
The directive is said to affect products from more than a dozen foreign companies, including Broadcom’s VMware, as well as software from Palo Alto Networks (NASDAQ: PANW) and Fortinet (NASDAQ: FTNT).
Reuters said it could not determine how many Chinese companies had received the notice, which people familiar with the matter said had been sent out in recent days. These concerns are related to concerns that foreign software could collect sensitive data and transfer it outside of China.
Check Point said it had not received any official notification and was not aware of restrictions on its China operations, adding that it would continue to support customers in the region. Broadcom, Palo Alto Networks and Fortinet had no immediate comment.
The report comes as tensions between the U.S. and China persist over technology and cybersecurity, including restrictions on China’s access to advanced artificial intelligence chips from Nvidia (NASDAQ: NVDA ) and Advanced Micro Devices (NASDAQ: AMD ).
