How U.S. microchips are fueling Russia’s military — despite sanctions
Western microchips used to power smartphones and laptops are continuing to enter Russia and fuel its military arsenal, new analysis shows.
Trade data and manifests analyzed by CNBC show that Moscow has been sourcing an increased number of semiconductors and other advanced Western technologies through intermediary countries such as China.
In 2022, Russia imported $2.5 billion worth of semiconductor technologies, up from $1.8 billion in 2021.
Semiconductors and microchips play a crucial role in modern-day warfare, powering a range of equipment including drones, radios, missiles, and armored vehicles.
The sanctions evasion and avoidance is surprisingly brazen at the moment.
Elina Ribakova
senior fellow at the Peterson Institute for International Economics
Indeed, the KSE Institute — an analytical center at the Kyiv School of Economics — recently analyzed 58 pieces of critical Russian military equipment recovered from Ukraine’s battlefield and found more than 1,000 foreign components, primarily Western semiconductor technologies.
Many of these components are subject to export controls. But, according to analysts CNBC spoke to, convoluted trade routes via China, Turkey, the United Arab Emirates and elsewhere mean they are still entering Russia, adding to the country’s pre-war stockpiles.
A collection of 58 pieces of Russian weaponry captured from the battlefield in Ukraine, such and drones and missiles, contained more than 1,000 Western components, according to a study from the KSE Institute.
CNBC
“Russia is still being able to import all the necessary Western-produced critical components for its military,” said Elina Ribakova, senior fellow at the Peterson Institute for International Economics, and one of the authors of KSE Institute’s report.
“The sanctions evasion and avoidance is surprisingly brazen at the moment,” she added.
Murky supply chains
Not all advanced technologies are subject to Western sanctions on Russia.
Many are dubbed dual-use items, meaning they have both civilian and military applications, and therefore fall outside of the scope of targeted export controls. A microchip may have applications in both a washing machine and a drone, for instance.
Still, many of these products originate from Western nations with sweeping trade bans against Moscow and, specifically, its military. All U.S.-origin items except food and medicine are prohibited from reaching Russia’s army.
It’s difficult to stop strictly civilian microelectronics from crossing borders.
Sam Bendett
advisor at the Center for Navel Analyses
In KSE’s study, more than two-thirds of the foreign components identified in Russian military equipment ultimately originated from companies headquartered in the U.S., with others coming from Ukrainian allies including Japan and Germany.
CNBC was unable to verify whether the implicated companies were aware of the final destination of their goods. Swiss authorities said they were working with firms to “educate them on red flags,” while government spokespeople for the other countries cited did not immediately respond to a request for comment.
Separately, a study from the Royal United Services Institute found that Russia’s military uses over 450 different types of foreign-made components in its 27 most modern military systems, including cruise missiles, communications systems and electronic warfare complexes. Many of these parts are made by well-known U.S. companies that create microelectronics for the U.S. military.
More than two-thirds of tech elements recovered in KSE Institute’s study originated from companies headquartered in the U.S.
CNBC
“Over decades, non-Russian high-tech systems and technologies became more advanced and really have become industry and global standards. So, a Russian military, as well as its civilian economy, have become dependent,” Sam Bendett, advisor at the Center for Naval Analyses, said.
The ubiquity and wide-reaching applications of such technologies have led them to become intertwined in global supply chains and therefore harder to police. Meanwhile, sanctions on Russia are largely limited to Ukraine’s Western allies, meaning that many countries continue to trade with Russia.
“It’s difficult to stop strictly civilian microelectronics from crossing borders and from taking place in global trade. And this is what the Russian industry as well as the Russian military and its intelligence services are taking advantage of,” Bendett said.
Russia-China trade spikes
Those trade flows can be messy. Typically, a shipment may be sold and resold several times, often through legitimate businesses, before eventually reaching a neutral intermediary country, where it can then be sold to Russia.
Data suggests China is by far the largest exporter to Russia of microchips and other technology found in crucial battlefield items.
Sellers from China, including Hong Kong, accounted for more than 87% of total Russian semiconductor imports in the fourth quarter of 2022, compared with 33% in Q4 2021. More than half (55%) of those goods were not manufactured in China, but instead produced elsewhere and shipped to Russia via China and Hong Kong-based intermediaries.
China is really trying to accumulate and to make profits and gains on the fact that Russia is economically isolated.
Olena Yurchenko
“This should not be taken as a surprise because China is really trying to accumulate and to make profits and gains on the fact that Russia is economically isolated,” Olena Yurchenko, advisor at the Economic Security Council of Ukraine, said.
China’s trade department did not respond to a request for comment on the findings, nor did the Russian government.
Meantime, Moscow has also increased its imports from so-called intermediary countries in the Caucasus, Central Asia and the Middle East, according to national trade data.
Exports to Russian from Central Asia and Caucasus countries has increased significantly since Moscow’s full-scale invasion of Ukraine, trade data shows.
CNBC
Exports to Russia from Georgia, Armenia and Kyrgystan, for instance, surged in 2022, with vehicles, aircraft and vessels accounting for a significant share of the uptick. At the same time, European Union and U.K. exports to those countries rose, while their direct trade with Russia plunged.
“A lot of these countries really cannot sever certain types of trade with Russia, especially those nations which are either bordering Russia, like Georgia, for example … as well as nations in Central Asia, which maintain a very significant trade balance with the Russian Federation,” Bendett said.
The governments of Georgia, Armenia and Kyrgyzstan did not respond to CNBC’s request for comment on the increase in trade.
Sanctions clampdown
The burgeoning trade flows have prompted calls from Western allies to either get more countries on board with sanctions, or slap secondary sanctions on certain entities operating within those countries in a bid to stifle Russia’s military strength.
In June 2023, the European Union adopted a new package of sanctions which includes an anti-circumvention tool to restrict the “sale, supply, transfer or export” of specified sanctioned goods and technology to certain third countries acting as intermediaries for Russia.
The package also added 87 new companies in countries spanning China, the United Arab Emirates and Armenia to the list of those directly supporting Russia’s military, and restricted the export of 15 technological items found in Russian military equipment in Ukraine.
If we have certain moral values … we cannot be giving [to Ukraine] with one hand and then giving to Russia with the other.
Elina Ribakova
senior fellow at the Peterson Institute for International Economics
“We are not sanctioning these countries themselves. What we are doing is preventing an already sanctioned product, which should not reach Russia, from reaching Russia through a third country,” EU spokesperson Daniel Ferrie said.
However, some are skeptical that the measures go far enough — particularly when it comes to major global trade partners.
“[The sanctions] may work against, let’s say, Armenia or Georgia, which are not big trade partners for European Union or for the United States. But in when it comes, for instance, to China or to Turkey, that’s a very unlikely scenario,” the Economic Security Council of Ukraine’s Yurchenko said.
Others say that responsibility ultimately lies with the companies, which need to do more to monitor their supply chains and avoid their goods falling into the wrong hands.
“The companies themselves should have the infrastructure to be able to track it and comply with export controls,” Ribakova said.
“If we have certain moral values or national security objectives, we cannot be giving [to Ukraine] with one hand and then giving to Russia with the other.”
The logo for the Food and Drug Administration is seen ahead of a news conference on removing synthetic dyes from America’s food supply, at the Health and Human Services Headquarters in Washington, DC on April 22, 2025.
Nathan Posner | Anadolu | Getty Images
The U.S. Food and Drug Administration on Tuesday published a warning letter addressed to the wrist wearable company Whoop, alleging it is marketing a new blood pressure feature without proper approvals.
The letter centers around Whoop’s Blood Pressure Insights (BPI) feature, which the company introduced alongside its latest hardware launch in May.
Whoop said its BPI feature uses blood pressure information to offer performance and wellness insights that inform consumers and improve athletic performance.
But the FDA said Tuesday that Whoop’s BPI feature is intended to diagnose, cure, treat or prevent disease — a key distinction that would reclassify the wellness tracker as a “medical device” that has to undergo a rigorous testing and approval processes.
“Providing blood pressure estimation is not a low-risk function,” the FDA said in the letter. “An erroneously low or high blood pressure reading can have significant consequences for the user.”
A Whoop spokesperson said the company’s system offers only a single daily estimated range and midpoint, which distinguishes it from medical blood pressure devices used for diagnosis or management of high blood pressure.
Whoop users who purchase the $359 “Whoop Life” subscription tier can use the BPI feature to get daily insights about their blood pressure, including estimated systolic and diastolic ranges, according to the company.
Whoop also requires users to log three traditional cuff-readings to act as a baseline in order to unlock the BPI feature.
Additionally, the spokesperson said the BPI data is not unlike other wellness metrics that the company deals with. Just as heart rate variability and respiratory rate can have medical uses, the spokesperson said, they are permitted in a wellness context too.
“We believe the agency is overstepping its authority in this case by attempting to regulate a non-medical wellness feature as a medical device,” the Whoop spokesperson said.
High blood pressure, also called hypertension, is the number one risk factor for heart attacks, strokes and other types of cardiovascular disease, according to Dr. Ian Kronish, an internist and co-director of Columbia University’s Hypertension Center.
Kronish told CNBC that wearables like Whoop are a big emerging topic of conversation among hypertension experts, in part because there’s “concern that these devices are not yet proven to be accurate.”
If patients don’t get accurate blood pressure readings, they can’t make informed decisions about the care they need.
At the same time, Kronish said wearables like Whoop present a “big opportunity” for patients to take more control over their health, and that many professionals are excited to work with these tools.
Understandably, it can be confusing for consumers to navigate. Kronish encouraged patients to talk with their doctor about how they should use wearables like Whoop.
“It’s really great to hear that the FDA is getting more involved around informing consumers,” Kronish said.
FILE PHOTO: The headquarters of the U.S. Food and Drug Administration (FDA) is seen in Silver Spring, Maryland November 4, 2009.
Jason Reed | Reuters
Whoop is not the only wearable manufacturer that’s exploring blood pressure monitoring.
Omron and Garmin both offer medical blood pressure monitoring with on-demand readings that fall under FDA regulation. Samsung also offers blood-pressure-reading technology, but it is not available in the U.S. market.
Apple has also been teasing a blood pressure sensor for its watches, but has not been able to deliver. In 2024, the tech giant received FDA approval for its sleep apnea detection feature.
Whoop has previously received FDA clearance for its ECG feature, which is used to record and analyze a heart’s electrical activity to detect potential irregularities in rhythm. But when it comes to blood pressure, Whoop believes the FDA’s perspective is antiquated.
“We do not believe blood pressure should be considered any more or less sensitive than other physiological metrics like heart rate and respiratory rate,” a spokesperson said. “It appears that the FDA’s concerns may stem from outdated assumptions about blood pressure being strictly a clinical domain and inherently associated with a medical diagnosis.”
The FDA said Whoop could be subject to regulatory actions like seizure, injunction, and civil money penalties if it fails to address the violations that the agency identified in its letter.
Whoop has 15 business days to respond with steps the company has taken to address the violations, as well as how it will prevent similar issues from happening again.
“Even accounting for BPI’s disclaimers, they do not change this conclusion, because they are insufficient to outweigh the fact that the product is, by design, intended to provide a blood pressure estimation that is inherently associated with the diagnosis of a disease or condition,” the FDA said.
WATCH: Watch CNBC’s full interview with FDA commissioner Dr. Marty Makary
United Launch Alliance Atlas V rocket carrying the first two demonstration satellites for Amazon’s Project Kuiper broadband internet constellation stands ready for launch on pad 41 at Cape Canaveral Space Force Station on October 5, 2023 in Cape Canaveral, Florida, United States.
Paul Hennessey | Anadolu Agency | Getty Images
As Amazon chases SpaceX in the internet satellite market, the e-commerce and computing giant is now counting on Elon Musk’s rival company to get its next batch of devices into space.
On Wednesday, weather permitting, 24 Kuiper satellites will hitch a ride on one of SpaceX’s Falcon 9 rockets from a launchpad on Florida’s Space Coast. A 27-minute launch window for the mission, dubbed “KF-01,” opens at 2:18 a.m. ET.
The launch will be livestreamed on X, the social media platform also owned by Musk.
The mission marks an unusual alliance. SpaceX’s Starlink is currently the dominant provider of low earth orbit satellite internet, with a constellation of roughly 8,000 satellites and about 5 million customers worldwide.
Amazon launched Project Kuiper in 2019 with an aim to provide broadband internet from a constellation of more than 3,000 satellites. The company is working under a tight deadline imposed by the Federal Communications Commission that requires it to have about 1,600 satellites in orbit by the end of July 2026.
Amazon’s first two Kuiper launches came in April and June, sending 27 satellites each time aboard rockets supplied by United Launch Alliance.
Assuming Wednesday’s launch is a success, Amazon will have a total of 78 satellites in orbit. In order to meet the FCC’s tight deadline, Amazon needs to rapidly manufacture and deploy satellites, securing a hefty amount of capacity from rocket providers. Kuiper has booked up to 83 launches, including three rides with SpaceX.
Space has emerged as a battleground between Musk and Amazon founder Jeff Bezos, two of the world’s richest men. Aside from Kuiper, Bezos also competes with Musk via his rocket company Blue Origin.
Blue Origin in January sent up its massive New Glenn rocket for the first time, which is intended to rival SpaceX’s reusable Falcon 9 rockets. While Blue Origin currently trails SpaceX, Bezos last year predicted his latest venture will one day be bigger than Amazon, which he started in 1994.
Kuiper has become one of Amazon’s biggest bets, with more than $10 billion earmarked for the project. The company may need to spend as much as $23 billion to build its full constellation, analysts at Bank of America wrote in a note to clients last week. That figure doesn’t include the cost of building terminals, which consumers will use to connect to the service.
The analysts estimate Amazon is spending $150 million per launch this year, while satellite production costs are projected to total $1.1 billion by the fourth quarter.
Amazon is going after a market that’s expected to grow to at least $40 billion by 2030, the analysts wrote, citing estimates by Boston Consulting Group. The firm estimated that Amazon could generate $7.1 billion in sales from Kuiper by 2032 if it claims 30% of the market.
“With Starlink’s solid early growth, our estimates could be conservative,” the analysts wrote.
WATCH: Amazon launches first Kuiper internet satellites into space
Bitcoin fell below the $117,000 level on Tuesday after cryptocurrency-related bills were blocked in the House of Representatives.
The price of bitcoin was last down 2.8% at $116,516.00, according to Coin Metrics. That marks a pullback from the day’s high of $120,481.86.
Bitcoin/USD Coin Metrics, 1-day
The drop comes on the heels of multiple crypto-related bills failing to overcome a procedural hurdle in the House, with 13 Republicans voting with Democrats to block the motion in a 196-223 vote.
In recent days, bitcoin has been trading at all-time highs, spurred by institutional buying of bitcoin exchange-traded funds (ETFs) amid rising optimism that Congress would soon pass crypto legislation.
Stocks linked to crypto also came under pressure in late afternoon trading. Shares of bitcoin miners Riot Platforms and Mara Holdings closed down 3.3% and 2.3%, respectively. Others like crypto trading platforms Coinbase slid 1.5%. All were under pressure in extended trading.
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