China is catching up with the West on tech, Microsoft president says
The West shouldn’t assume that China is lagging behind the U.S. and Europe on tech developments, Microsoft’s president and vice-chairman warned.
U.S-China tensions in the past few years have centered on the battle between the two nations for tech supremacy, culminating in a slew of export controls on critical technologies. Late last year, China’s Huawei surprised the market with the release of a smartphone whose reviews indicated downloads speeds associated with 5G, sparking speculation of an apparent chip breakthrough that defied U.S. tech sanctions.
Speaking at the Web Summit tech conference in Lisbon, Portugal, on Tuesday, Microsoft’s Brad Smith told CNBC that “in many ways,” China is close to or is even catching up on technology.
“I think one of the dangers, frankly, is that people who don’t go to China too often assume that they’re behind,” he told CNBC’s Karen Tso. “But when you go there, you’re impressed by how much they’re doing.”
He predicted that Chinese and American companies will be competing on technology into the distant future and urged U.S. and European companies to collaborate to grow economies and bring new advancements like artificial intelligence to the rest of the world.
Microsoft CEO Brad Smith participates in a meeting at The Westin Palace Hotel, on 20 May, 2022 in Madrid, Spain.
Cezaro De Luca | Europa Press | Getty Images
Microsoft has operated in China since 1992, according to the company’s web page, including through its largest research and development center outside the U.S. Microsoft CEO Satya Nadella said last year that the firm wasn’t focused on China as a domestic market, but that it provides services to Chinese companies and has a more visible presence locally than do many other U.S. tech giants.
Asked about whether trade and tech transfers — or the movement of data, designs or innovations — with China will get more challenging as Washington transitions between the administrations of U.S. incumbent leader Joe Biden and President-elect Donald Trump, Smith it was too early tor know.
“The truth is, as an American technology company, we can do business in China only when we are offering a service that the Chinese government wants to have there, and the U.S. government wants us to bring there,” he said, adding, “And in some cases they look at, say, a data center to support a Mercedes or a Siemens or a Starbucks or a General Motors — there seems to be a level of comfort. In consumer services, not really.”
He predicted that we’ll live in a world where some technology will move to China, and it won’t be the tech firms that decide.
—CNBC’s Jordan Novet contributed to this article.
FILE PHOTO: Ariel Cohen during a panel at DLD Munich Conference 2020, Europe’s big innovation conference, Alte Kongresshalle, Munich.
Picture Alliance for DLD | Hubert Burda Media | AP
Navan, a developer of corporate travel and expense software, expects its market cap to be as high as $6.5 billion in its IPO, according to an updated regulatory filing on Friday.
The company said it anticipates selling shares at $24 to $26 each. Its valuation in that range would be about $3 billion less than where private investors valued Navan in 2022, when the company announced a $300 million funding round.
CoreWeave, Circle and Figma have led a resurgence in tech IPOs in 2025 after a drought that lasted about three years. Navan filed its original prospectus on Sept. 19, with plans to trade on the Nasdaq under the ticker symbol “NAVN.”
Last week, the U.S. government entered a shutdown that has substantially reduced operations inside of agencies including the SEC. In August, the agency said its electronic filing system, EDGAR, “is operated pursuant to a contract and thus will remain fully functional as long as funding for the contractor remains available through permitted means.”
Cerebras, which makes artificial intelligence chips, withdrew its registration for an IPO days after the shutdown began.
Navan CEO Ariel Cohen and technology chief Ilan Twig started the company under the name TripActions in 2015. It’s based in Palo Alto, California, and had around 3,400 employees at the end of July.
For the July quarter, Navan recorded a $38.6 million net loss on $172 million in revenue, which was up about 29% year over year. Competitors include Expensify, Oracle and SAP. Expensify stock closed at $1.64on Friday, down from its $27 IPO price in 2021.
Navan ranked 39th on CNBC’s 2025 Disruptor 50 list, after also appearing in 2024.
Jensen Huang, CEO of Nvidia, speaking with CNBC’s Jim Cramer during a CNBC Investing Club with Jim Cramer event at the New York Stock Exchange on Oct. 7th, 2025.
Kevin Stankiewicz | CNBC
Shares of Amazon, Nvidia and Tesla each dropped around 5% on Friday, as tech’s megacaps lost $770 billion in market cap, following President Donald Trump’s threats for increased tariffs on Chinese goods.
With tech’s trillion-dollar companies occupying an increasingly large slice of the U.S. market, their declines send the Nasdaq down 3.6% and the S&P 500 down 2.7%. For both indexes, it was the worst day since April, when Trump said he would slap “reciprocal” duties on U.S. trading partners.
After market close on Friday, Trump declared in a social media post that the U.S. would impose a 100% tariff on China and on Nov. 1 it would apply export controls “on any and all critical software.”
Amazon, Nvidia and Tesla all slipped about 2% in extended trading following the post.
The president’s latest threats are disrupting, at least briefly, what had been a sustained rally in tech, built on hundreds of billions of dollars in planned spending on artificial intelligence infrastructure.
In late September, Nvidia, which makes graphics processing units for training AI models, became the first company to reach a market cap of $4.5 trillion. Nvidia alone saw its market capitalization decline by nearly $229 billion on Friday.
OpenAI counts on Nvidia’s GPUs from a series of cloud suppliers, including Microsoft. OpenAI is only seeing rising demand.
In September it introduced the Sora 2 video creation app, and this week the company said the ChatGPT assistant now boasts over 800 million weekly users. But Microsoft must buy infrastructure to operate its cloud data centers. Microsoft’s market cap dropped by $85 billion on Friday.
The sell-off wiped out Amazon’s gains for the year. That stock is now down 2% so far in 2025. It competes with Microsoft to rent out GPUs from its cloud data centers, but it doesn’t have major business with OpenAI. The online retailer is now worth $121 billion less than it was on Thursday.
“There continues to be a lot of noise about the impact that tariffs will have on retail prices and consumption,” Amazon CEO Andy Jassy told analysts in July. “Much of it thus far has been wrong and misreported. As we said before, it’s impossible to know what will happen.”
Tesla, which introduced lower-priced vehicles on Tuesday, saw its market capitalization sink by $71 billion.
The automaker reports third-quarter results on Oct. 22, with Microsoft earnings scheduled for the following week. Nvidia reports in November.
Google parent Alphabet and Facebook owner Meta fell 2% and almost 4%, respectively.
WATCH: Pres. Trump: Calculating massive increase of tariffs on Chinese products into U.S.
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