Panoramic view of the Baidu office building in Pudong, Shanghai, February 9, 2026.
Ying Tan | Null Photo | Getty Images
The Department of Defense added a number of Chinese companies, including: alibaba group, Baidu Co., Ltd. and car manufacturers BYDon a list of entities believed to be supporting the Chinese military and complicating fragile diplomatic relations between Washington and Beijing.
The Department of Defense announced the updated “1260H list” in the United States on Monday night. This is a directory of companies that the Department of Defense considers to be affiliated with China’s military or defense industrial base.
The designation does not explicitly impose sanctions, but it means the Department of Defense will be prohibited from contracting directly with publicly traded companies starting later this month and from procuring the companies’ products and services through third parties starting in June 2027.
“These indirect restrictions could force some U.S. companies working with the U.S. military to remove designated Chinese companies as suppliers,” said Michael Herson, head of China research at 22V Research.
Baidu’s US deposit income decreased by 2.1%, Alibaba by 0.8%, and BYD by 0.8%.
The additions come after President Donald Trump met with Chinese President Xi Jinping in Beijing last month, where the two leaders agreed to a trade ceasefire and announced the creation of a joint investment and trade council. The latest information highlights repeated tensions in bilateral relations and Washington’s security concerns about Chinese technology as a strategic threat.
The Pentagon briefly released a similar expanded list in February, but withdrew it without explanation as President Trump’s visit to China was pending. The version released Monday largely mirrors that February update, but reinstates Chinese memory chip makers CXMT and YMTC, which had been left off the withdrawal list, an omission that drew criticism from China hawks in Washington at the time.
According to the Pentagon’s notice, the listed companies are considered to be affiliated with the China State-Owned Assets Regulatory Commission and designated as companies contributing to “military-civil fusion” to China’s defense industrial base through their ties to the Ministry of Industry and Information Technology.
The list also includes biotech giant WuXi AppTec, lidar maker RoboSense Technology, and China’s leading humanoid robot maker Unitree. Last week, US semiconductor maker Nvidia announced plans to work with the company to develop research robots.
The breadth of the additions reflects the U.S. government’s view that Chinese private technology companies are inextricably linked to the nation’s military priorities, and highlights concerns that are driving U.S. government restrictions on Chinese semiconductors, artificial intelligence hardware, and advanced manufacturing.
Herson said the move is largely symbolic, given that China does not fall under investment or export blacklists, but it shows how broadly the U.S. government is drawing the line on sensitive Chinese technology, which spans consumer electronics, biotechnology and robotics.
Still, Herson said he does not expect the U.S. Treasury or Commerce Department to subject prominent Chinese tech companies to more formal restrictions this year because the U.S. prioritizes keeping the bilateral relationship on a stable footing.
Wuxi AppTec and Alibaba have vowed to object to the designation and seek its removal. Baidu and BYD did not respond to requests for comment.
“There is no basis to conclude that Alibaba should be placed on the Section 1260H list. Alibaba is not a Chinese military company or part of any civil-military fusion strategy. We will take all legal action against any attempt to misrepresent us,” the company said in a statement to CNBC.
Some Chinese companies filed suit with the Department of Defense to challenge the listing, and Xiaomi won the court challenge, resulting in its removal from the list in May 2021.
