US technology firms Nvidia and AMD commit to sharing 15% of their earnings from the sale of AI chips in China with the state of Washington.
Nvidia and AMD Strike Unprecedented Deal with U.S. Government
In a move that has garnered significant attention from international media outlets, Nvidia and AMD have reached an agreement with the U.S. government to pay a 15% tariff on revenue from the sales of their most advanced AI chips in China.
The deal, which was finalized on August 6, 2025, following a meeting between Nvidia CEO Jensen Huang and then-President Trump, allows Nvidia to sell its H20 AI chip and AMD its MI308 chip to Chinese customers. The agreement was publicly confirmed by Trump on August 11.
Under this arrangement, both companies will comply with U.S. government export control policies, ensuring that they can remain competitive in both the Chinese and global markets. Nvidia, a California-based company and the world's leading semiconductor producer, is at the heart of the technological rivalry between Beijing and Washington.
The revenue-sharing agreement is a significant development in the ongoing trade tensions between the U.S. and China. The resumption of chip sales could generate more than $2 billion for the U.S. government, according to the New York Times. Access to Nvidia's advanced H20 chips for Chinese companies is a major issue in discussions between the two powers.
The agreement comes as Nvidia recently surpassed $4 trillion in market capitalization, demonstrating the market's bet on artificial intelligence. AMD, based in Silicon Valley, will also resume sales of its MI308 chips in China, following the same export restrictions.
Artificial intelligence is revolutionizing the global economy, and this deal underscores the importance of this technology in international trade and technology commerce. This unusual arrangement, as noted by the Financial Times, Bloomberg, and the New York Times, represents an unprecedented revenue-sharing agreement linked to export control and trade policy.
[1] Source: Nvidia and AMD's official statements and press releases.
This deal, reflecting the technological rivalry between Beijing and Washington, is a significant step in the global AI market as Nvidia and AMD will resume selling their advanced H20 and MI308 chips in China. The revenue generated from these sales could significantly impact the U.S. government's economy, given the potential more than $2 billion generation as stated by the New York Times. This arrangement, marked by unusual revenue sharing and export control policies, highlights the central role technology plays in international trade and commerce.
