By Ian Maleve
Nvidia and AMD have agreed to remit 15 percent of their revenues from AI chip sales to China to the U.S. government under a rare export licensing arrangement, according to U.S. officials.
The deal applies specifically to Nvidia’s H20 and AMD’s MI308 semiconductors and marks an unusual precedent in trade and technology policy.
This revenue-sharing condition emerged after prior restrictions on exporting high-end chips to China. The U.S. Commerce Department began approving licenses for Nvidia’s H20 exports on Friday, followed by AMD’s MI308 over the weekend.
The agreement was reportedly reached following a meeting between Nvidia’s CEO and President Trump, signaling a shift in the U.S. export stance amid growing global competition in artificial intelligence.
While Nvidia has stated that it adheres to U.S. export rules, AMD declined to comment. Some U.S. officials have framed the agreement not only as a revenue tool but also as a strategic lever to better control AI technology transfers to China.
Security experts, however, have expressed concern that tying export access to revenue-sharing could undermine the credibility of export controls and contravene constitutional provisions against export taxes.
Analysts estimate that Nvidia could garner as much as $23 billion from H20 chip sales in China in 2025 a figure that contextualizes why even a 15 percent cut could be substantial. AMD, meanwhile is positioned to capture significant revenue through MI308 exports in the same market.
The deal’s financial implications extend beyond Nvidia and AMD. Taiwan Semiconductor, responsible for manufacturing many of these chips, also saw its stock rise, driven by investor anticipation of renewed demand.
Nvidia and AMD stocks likewise benefited from the positive market sentiment generated by the resumption of Chinese sales.
While the U.S. has yet to clarify how the funds will be used, the arrangement reflects a broader recalibration of export policy where foreign market access is now intertwined with revenue-sharing mechanisms.
Critics argue that such a model distorts market dynamics and blurs the line between regulatory oversight and revenue generation.
In summary, this groundbreaking revenue-sharing deal underscores the fraught balance between maintaining technological dominance, securing economic returns, and navigating geopolitical realities in the evolving AI and semiconductor landscape.
