Nvidia, AMD to Pay 15% China Chip Revenue to US
The Trump administration subsequently banned its sale in April this year. Nvidia’s CEO, Jensen Huang, has been lobbying for months.
The US previously banned sales of Nvidia's H20 chips to China on security grounds. That ban is now lifted. The chips have widespread use in AI systems. Photo/ KBC Digital
By Juliet Jerotich
US chipmakers Nvidia and AMD will pay 15% of their revenue from selling semiconductors to China to the US government. The arrangement was confirmed to the BBC by a source with knowledge of the matter.
The contribution is part of the deal that allows the two firms to secure export licenses for sales to China, the world’s second-largest economy.
Nvidia informed the BBC that it complies with regulations established by the US government for international markets. “We haven’t exported H20 to China for months,” the firm stated. “We hope export regulations will allow America to compete in China and globally.”
AMD has yet to comment on requests.
Nvidia also asserted that America must not repeat the “5G mistake” and let telco leadership fall through its hands. The company mentioned that the US artificial intelligence tech stack could become a worldwide standard if America moves quickly.
According to the agreement, Nvidia will supply 15% of its H20 chip sales from China to the US. AMD will supply the same proportion from MI308 chip sales. The Financial Times first broke the story.
Charlie Dai, a vice president at Forrester, called the agreement “unprecedented.” He said it was indicative of the steep cost of entering the market in a period of heightened US-China technology tensions. The agreement, he said, carries huge financial cost and risk for tech vendors.
The US previously banned sales of Nvidia’s H20 chips to China on security grounds. That ban is now lifted. The chips have widespread use in AI systems.
Deborah Elms, director of trade policy at the Hinrich Foundation, was doubtful about the measure. “If you’re dealing with a national security concern, a 15% payment doesn’t remove it,” she replied.
The H20 chip was designed for China after Washington imposed curbs on exports in 2023. The Trump administration subsequently banned its sale in April this year. Nvidia’s CEO, Jensen Huang, has been lobbying for months. He recently met President Donald Trump, it is said, to plead that sales be resumed.
This move follows the relaxation of trade tensions between Beijing and Washington. China has eased rare earth export controls. The US has removed restrictions on chip design software companies in China.
Both nations signed a 90-day truce in the tariff war in May. Negotiations have remained ongoing, although there has not been a decision regarding a continuation beyond the 12 August deadline.
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