Nvidia, AMD Strike Deal to Pay 15% of China Chip Sales to US Government

Chip giants Nvidia and AMD will each pay 15% of China semiconductor sales to the US government under a new agreement.

Chip giants Nvidia and AMD will each pay 15% of China semiconductor sales to the US government under a new agreement.
Chipmaking giants Nvidia and AMD have agreed to hand over 15% of their semiconductor sales revenues in China to the United States government, in a move described by analysts as “unprecedented” amid easing but still fragile US-China trade tensions.
The arrangement, first reported by the Financial Times is part of a deal allowing both companies to resume exports of certain high-performance chips to the world’s second-largest economy.
Under the agreement, Nvidia will pay 15% of its revenues from sales of the H20 chip in China, while AMD will pay the same percentage from sales of its MI308 chip. Both chips are key components in artificial intelligence (AI) applications.
“We follow rules the US government sets for our participation in worldwide markets,” Nvidia told the BBC. “While we haven’t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide. America cannot repeat 5G and lose telecommunication leadership. America’s AI tech stack can be the world’s standard if we race.”
The deal comes after Washington reversed a ban on the sale of Nvidia’s H20 chips to Beijing, initially imposed over national security concerns. The H20 chip was developed specifically for China in 2023 after US export restrictions. Sales were later halted in April 2025 under the Trump administration before recent negotiations revived the trade.
Charlie Dai, vice president and principal analyst at global research firm Forrester, said the arrangement underscores the “high cost of market access” for US tech firms operating in China. “It creates substantial financial pressure and strategic uncertainty for tech vendors,” he said.
However, some trade experts questioned whether the deal aligns with Washington’s stated security concerns. “You either have a national security problem or you don’t,” said Deborah Elms, head of trade policy at the Hinrich Foundation. “If you have a 15% payment, it doesn’t somehow eliminate the national security issue.”
The agreement comes amid tentative signs of a thaw in US-China trade relations. Beijing recently eased restrictions on rare earth exports, while Washington lifted curbs on chip design software sales to China. In May, both countries agreed to a 90-day truce in their tariff war, though it is unclear if the pause will be extended before the 12 August deadline.
The Biden and Trump administrations have both pushed for greater US-based semiconductor production, with President Trump in particular pressuring companies to increase domestic investment. Apple recently pledged an additional $100bn in US investments over the next four years, while Micron Technology announced a $200bn plan to expand production in Idaho. Nvidia itself has committed up to $500bn to build AI servers and the first entirely American-made AI supercomputers.
With the latest agreement, Nvidia’s CEO Jensen Huang — who reportedly met President Trump last week — has succeeded in securing renewed access to the Chinese market. But whether the 15% levy marks a sustainable model for balancing market access with geopolitical security concerns remains to be seen.
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