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Nvidia and AMD agree to give US 15% of China chip revenues

  • By Al Mayadeen English
  • Source: News websites
  • 11 Aug 2025 10:03
3 Min Read

Nvidia and AMD will pay the US government a portion of chip sales to China in a move to secure export licenses, sparking a national security debate as Washington navigates tense trade talks with Beijing.

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  • This photograph taken in Paris on February 23, 2024 shows a US multinational Nvidia's graphic processing unit (GPU). (AFP)
    This photograph taken in Paris shows a US multinational Nvidia's graphic processing unit (GPU) on February 23, 2024. (AFP)

In a first-of-its-kind arrangement, chip manufacturing giants Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales in China, in exchange for export licences, The Financial Times (FT) reported on Sunday.

The agreement, reached with the Trump administration, has sparked debate over security risks and economic strategy in the global chips industry.

According to US officials and people familiar with the matter, Nvidia will share 15% of its H20 chip revenues from China, while AMD will provide the same percentage from its MI308 chip sales. The unusual deal was made a condition for the export licences granted last week.

While the Trump administration has not decided how the collected funds will be used, the FT reported that analysts estimate Nvidia’s China H20 sales in 2025 could reach $23 billion, potentially generating billions for the US government.

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How the revenue-sharing deal emerged

The arrangement follows months of uncertainty over the H20 chip, designed specifically for the Chinese market after former President Joe Biden imposed restrictions on more advanced AI chips. In April, the Trump administration announced a ban on H20 exports to China but reversed the decision in June following a White House meeting between Nvidia CEO Jensen Huang and President Donald Trump.

After the meeting, the US Commerce Department’s Bureau of Industry and Security began issuing licences for both Nvidia and AMD chips destined for China. The deal has drawn criticism from national security experts who warn that allowing H20 exports could strengthen China’s artificial intelligence capabilities, potentially benefiting its military.

The FT report cited Liza Tobin, a former National Security Council official, who said, "Beijing must be gloating to see Washington turn export licences into revenue streams. What’s next, letting Lockheed Martin sell F-35s to China for a 15 per cent commission?"

A group of 20 experts, including former Deputy National Security Adviser Matt Pottinger, urged the US Commerce Secretary to block the licences, calling the H20 "a potent accelerator of China’s frontier AI capabilities." Nvidia rejected the claims, saying they were "misguided" and denied that the chips could be used for military purposes.

The deal comes amid tense US-China trade negotiations, with Trump seeking to maintain dialogue ahead of a potential summit with Chinese President Xi Jinping. Some US officials have expressed concern that easing export controls could undermine long-term technological advantages in chip manufacturing.

According to the FT, Beijing is also pushing for relaxed restrictions on high-bandwidth memory (HBM) chips, a key component in advanced AI chip production.However, Nvidia defended its stance, stating, “America cannot repeat 5G and lose telecommunication leadership. America’s AI tech stack can be the world’s standard if we race.”

  • Nvidia
  • AMD
  • Chips industry
  • Chinese chipmakers
  • semiconductors
  • Nvidia H20 Chip
  • China
  • US
  • Donald Trump
  • Chip Manufacturing

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