US government secures 15 per cent cut from Nvidia, AMD China chip sales

New York: Nvidia and AMD have entered into an unprecedented agreement with the U.S. government to share 15 per cent of their revenues from chip sales to China as a condition for resuming exports of specific advanced AI processors, Nvidia’s H20 and AMD’s MI308, to the Chinese market.

A U.S. government official, speaking to the AP on condition of anonymity since the policy has not yet been formally announced, confirmed the revenue-sharing terms and said the Financial Times report detailing the arrangement was broadly accurate. The official clarified that the agreement is part of the export licensing conditions Washington imposed to allow the companies to restart certain chip sales to China.

The move follows the Trump administration’s April 2025 decision to halt sales of advanced computer chips to China over national security concerns. In July, Nvidia and AMD disclosed that they had been granted permission to resume sales of the H20 and MI308 chips, which are widely used in artificial intelligence development, under the new agreement.

Nvidia did not comment on the specifics of the quid pro quo arrangement but reaffirmed that it would comply with U.S. export control rules. In a statement to the AP, the company said, “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. America cannot repeat 5G and lose telecommunication leadership. America’s AI tech stack can be the world’s standard if we race.”

AMD has not yet responded to media requests for comment.

The 15 per cent revenue share is neither a tax nor a fine, but a negotiated condition tied to export approvals, and marks the first time the U.S. government will directly collect a portion of corporate earnings from tech sales to a geopolitical rival. According to officials, these funds will support U.S. semiconductor R&D, strengthen technology security, and help enforce export controls.

In July, Nvidia warned that tighter export restrictions could cost the company an additional $5.5 billion, arguing that overly strict rules hinder U.S. competitiveness in one of the largest tech markets in the world and risk pushing other countries toward adopting Chinese AI technology instead.

Restrictions on high-end chip sales have been at the heart of the AI race between the U.S. and China. Supporters of these measures say they are vital for slowing Beijing’s AI progress to give American companies an edge, while critics argue such curbs contain loopholes and may even accelerate innovation elsewhere.

Concerns were renewed in January with the launch of China’s DeepSeek AI chatbot, which some U.S. analysts see as an example of how advanced chips could be leveraged to bolster China’s AI capabilities despite existing export controls.

With inputs from AP