Nvidia and AMD "hand over" profits to Trump - 15% of revenue from chip sales in China goes to the US government
Nvidia and AMD have agreed to give the United States government 15% of revenue from sales in China of advanced computer chips, such as Nvidia's H20 model, which is used for artificial intelligence applications.
US President Donald Trump's administration banned sales of H20 chips to China in April, but Nvidia last month announced that the US would allow shipments to resume and the company hopes to start deliveries soon.
When asked if Nvidia had agreed to pay 15% of revenue to the US, a company spokesperson said in a statement: "We follow the rules the US government sets for our participation in global markets. Although we have not shipped H20 chips to China in months, we hope that export control rules will allow America to compete in China and in the global market."
Beijing is a key market for both companies. Nvidia generated $17 billion in revenue from China in the fiscal year that ended Jan. 26, accounting for 13% of total sales. AMD reported $6.2 billion in revenue from China for 2024, accounting for 24% of total revenue.
According to the Financial Times, chipmakers accepted the deal as a condition of obtaining export licenses. The report adds that the Trump administration has not yet decided how it will use the money.
A US official said: "Either the sale of H20 chips to China poses a national security risk, and then it should not be done, or it is not a risk. In the latter case, why is this additional penalty being imposed on their sale?"
US Commerce Secretary Howard Lutnick said last month that the planned restart of chip sales was part of US negotiations with China to obtain rare earth minerals, and described the H20 model as Nvidia’s “fourth best chip.” Lutnick added that it is in the US interest for Chinese companies to use American technology, even if the most advanced chips are banned from export.
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