The United States government, under the second Trump administration, has reached a precedent-setting arrangement with Nvidia and AMD. The agreement requires these two to hand over 15 percent of their AI chip sales from China to the U.S. government. This condition is integral to export license approvals for models such as Nvidia H20 and AMD MI308 and marks an unprecedented intersection of commerce and national security.
Reporting from multiple global sources indicates that unnamed United States officials confirmed the revenue share. Spokespeople from both chip companies have declined to confirm specifics publicly. The mechanics of that transfer remain deliberately opaque. There is no clarity on whether the payment represents a fee, surtax, escrowed amount, or some alternative structure. That opacity has heightened scrutiny from analysts and policy observers.
China has responded by raising security concerns. These included allegations of potential backdoor vulnerabilities and remote shutdown capabilities. Chinese regulatory authorities summoned Nvidia representatives for explanations. State-affiliated media further questioned the safety of the H20 chip. Nvidia has rejected such implications. It reaffirms and assures that its hardware products do not contain any unauthorized access risks or hidden functionality.
The agreement emerges amid a wider technological rivalry between Washington and Beijing. Previous United States export restrictions targeted high-performance chips essential for advanced artificial intelligence development. Semiconductor companies such as Nvidia designed modified chips like the H20 to meet regulatory thresholds, only to face new layers of control that now include both licensing requirements and fiscal obligations.
Analysts caution that the arrangement may undermine the conceptual integrity of export controls by conflating geopolitical strategy with financial incentives. Critics fear that monetizing licensing could establish a problematic precedent, prompt legal challenges, and complicate alliances. China, for its part, may escalate regulatory pressures or accelerate domestic semiconductor development in response to what is seen as transactional diplomacy.
The market response to the announcement has been measured yet notable. The share prices of both Nvidia and AMD experienced brief declines in the stock market as investors weighed potential revenue losses against the opportunity to maintain access to the Chinese market. The reduced margin impact is significant. However, considering medium-term prospects, the broader strategic value of continued engagement with China remains a decisive factor.
Future developments will depend on the willingness of both governments to balance commercial interests with national security priorities. Observers anticipate that China will intensify its push for semiconductor self-sufficiency, while the United States may face pressure to explain the merits of its unique and controversial policy approach. The global technology sector will watch closely, aware that precedent here may influence export regimes elsewhere.