Nvidia and AMD, two prominent American semiconductor firms, have reportedly agreed to a significant financial deal with the U. S. government regarding the sale of advanced chips to China. A senior official revealed that both companies will pay 15% of their revenues from these sales as a condition for export licenses. This move follows a halt in sales instituted by the Trump administration in April 2025 to restrict advanced technology exports to China over national security concerns. The restriction particularly affected cutting-edge chips like Nvidia’s H20 chip, vital for AI applications. Recently, the U. S. Commerce Department resumed issuing export licenses, allowing Nvidia and potentially AMD to restart shipments of advanced semiconductors to China. Nvidia confirmed compliance with U. S. regulations but did not explicitly verify the payment details; AMD and China’s Foreign Ministry have declined to comment. China is a crucial market: for Nvidia, sales to China amount to about $17 billion or 13% of its revenue, while AMD’s Chinese market accounts for $6. 2 billion, or approximately 24%. This market importance adds complexity and high stakes to U. S. export policy decisions. Officials assert that Nvidia’s H20 chip, the company’s fourth-best product, poses no national security risk. Promoting U. S.

technology use in China aligns with broader U. S. interests. Nonetheless, critics worry that the required revenue-sharing deal might prioritize short-term financial gains over long-term security. The specifics of the 15% revenue-sharing mechanism, including its timing and implementation, remain unclear, stirring debate among policymakers, industry experts, and analysts about balancing technology protection with economic relations. This arrangement marks a shift in U. S. policy from the previous administration’s stringent export bans, toward a more pragmatic approach regulating and taxing sales rather than prohibiting them outright. It reflects acknowledgment of China’s economic importance and expanding role in global technology. Industry observers note that semiconductors like Nvidia’s H20 chip are central to U. S. -China technological competition, particularly in AI development across defense, telecommunications, and consumer electronics, making export control a key national security issue. The U. S. government’s conditional licensing based on financial contributions is unprecedented and may set a future precedent for managing other sensitive technologies, balancing economic and security interests. Nvidia and AMD must now navigate these new regulatory requirements while considering the impact on profitability and R&D investment, given the additional revenue-sharing costs. China’s silence on the matter suggests caution, while the international community closely monitors evolving U. S. technology export policies amid growing geopolitical tensions. Overall, the deal highlights the complexities of global high-tech trade, raising critical questions about protecting technological leadership while engaging in beneficial economic exchanges. Further policy refinements and company adjustments are expected in the coming months as the landscape of international technology commerce evolves.