Nvidia and AMD have reportedly agreed to hand over 15% of their China chip sales revenue to the U.S. government under a landmark deal with the Trump administration to secure export licenses for key semiconductor products.
Bernstein analysts estimate Nvidia could sell roughly 1.5 million H20 units in China in 2025, generating about $23 billion — meaning the U.S. government's share could exceed $3 billion.
The unprecedented agreement, confirmed by a U.S. official to the Financial Times on Sunday, applies to Nvidia's H20 artificial intelligence chips and AMD's MI308 processors — both designed for the Chinese market. The licenses were granted last week after Nvidia CEO Jensen Huang met with President Donald Trump at the White House.
While it remains unclear how Washington will use the funds, the deal represents a first in U.S. export control policy. Analysts see it as part of a broader Trump strategy of leveraging trade and regulatory authority to compel companies to make financial or operational concessions that boost U.S. revenue and jobs.
Nvidia had previously halted H20 shipments after the Biden administration banned their export in April, citing national security risks. Trump reversed that decision in June, but the Bureau of Industry and Security delayed issuing licenses until last Friday — two days after Huang's meeting with the president.
The move has drawn sharp criticism from national security experts, who warn the chips could enhance China's military capabilities. In a letter to Commerce Secretary Howard Lutnick, former Trump deputy national security adviser Matt Pottinger and 19 others urged the administration to block the licenses, calling the H20 "a potent accelerator" for Chinese AI development. Nvidia dismissed the claims as "misguided."
The deal comes as Trump seeks to ease trade tensions ahead of potential talks with Chinese President Xi Jinping, even as Beijing presses Washington to relax curbs on other advanced chip components.
Newsmax's Eric Mack contributed to this report.
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