Nvidia has agreed to give the U.S. government 15% of the revenue it earns from selling AI chips to China, as per Financial Times. A U.S. official told Reuters on Friday that the Commerce Department has now started granting the company licenses to export its H20 chips to the Chinese market.
Even AMD has struck a similar deal, agreeing to hand over 15% of its revenue from AI chip sales to China in exchange for a special export license. This arrangement means the U.S. government will directly benefit from the sale of sensitive technology to one of its key geopolitical competitors.
The payments apply only to chips that need special export licenses, not every product sold in China. Under the deal, both Nvidia and AMD must maintain detailed sales records and submit them regularly to U.S. authorities.
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The agreement was reportedly sealed last week during a White House meeting between Nvidia CEO Jensen Huang and President Donald Trump. It especially covers Nvidia’s H20 chip and AMD’s MI308 chip, both redesigned with lower performance to meet U.S. export rules. These toned-down versions were created so the companies could continue limited sales to China while staying within national security guidelines.
“We follow rules the U.S. government sets for our participation in worldwide markets. While we haven’t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide,” said Nvidia in a statement to BBC News.
This marks the first time since April that the two American chipmakers will be able to sell their AI chips in China again. Nvidia’s H20 chip was first developed in response to U.S. export restrictions introduced in 2023 under the Biden administration. It was a less powerful version of the company’s top tech, approved for the Chinese market at the time. Later, the Trump administration banned sales of both the H20 and AMD’s competing MI308 chip.
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In May, Nvidia reported that the H20 chip generated $4.6 billion in first-quarter sales, with the Chinese market making up about 12.5% of its total revenue for the period. Nvidia went on to become to the world’s most valuable company, hit the $4 trillion mark.
In July, Washington announced plans to restore Nvidia’s sales to China, but the export licenses required for those transactions weren’t granted right away. Now, with the new agreement in place, the restrictions have been eased, which is now seen as a part of a broader move in U.S.-China trade relations, as Beijing loosens rare earth export limits and Washington rolls back certain curbs on chip design software.