whilst you were sleeping the new initiative is put through, a somewhat wild one, and one guaranteed to either not-work-well or not-work-at-all; am almost sure it is a bargaining-chip chip per 9D chess, because should Team China feel like to engage in same game, once again rare-earths go unobtainium
something about trump cards is that they stay trump cards and always efficacious
bloomberg.com
Nvidia, AMD to Pay US 15% of China AI Chip Sales in Unusual Move
Nvidia and AMD agreed to pay 15% of their revenues from chip sales to China to the US government.Source: Bloomberg
By Hadriana Lowenkron, Michael Sasso, and Ian King
August 11, 2025 at 4:04 AM GMT+7
Updated on
August 11, 2025 at 8:42 AM GMT+7
Takeaways by Bloomberg AI
- Nvidia Corp. and Advanced Micro Devices Inc. agreed to pay 15% of their revenues from Chinese AI chip sales to the US government in a deal to secure export licenses.
- The arrangement reflects US President Donald Trump’s effort to engineer a financial payout for America in return for concessions on trade, according to the text.
- Jacob Feldgoise, a researcher at the Center for Security and Emerging Technology, said the arrangement "will likely undermine the US' position when negotiating with allies to implement complementary controls".
The arrangement reflects US President Donald Trump’s consistent effort to engineer a financial payout for America in return for concessions on trade. His administration has shown a willingness to relax trade conditions like tariffs in return for giant investment in the US — as with Apple Inc.’s pledge to spend $600 billion on domestic manufacturing. But such a narrow, select export tax has little precedent in modern corporate history.
Beijing, which has grown increasingly hostile to the idea of Chinese firms deploying the H20, is unlikely to warm to the idea of a chip tax. Yuyuantantian, a social media account affiliated with state-run China Central Television that regularly signals Beijing’s thinking about trade, on Sunday slammed the chip’s supposed security vulnerabilities and inefficiency.
“This seeming quid pro quo is unprecedented from an export control perspective. The arrangement risks invalidating the national security rationale for U.S. export controls,” said Jacob Feldgoise, a researcher at the DC-based Center for Security and Emerging Technology.
It “will likely undermine the US’ position when negotiating with allies to implement complementary controls,” he added. “Allies may not believe U.S. policymakers if they are willing to trade away those same national security concerns for economic concessions — either from U.S. companies or foreign governments.”
An Nvidia spokesperson said the company follows US export rules, adding that while it hasn’t shipped H20 chips to China for months, it hopes the rules will allow US companies to compete in China. AMD didn’t immediately respond to a request for comment.
The Financial Times earlier reported the development. It followed a separate report from the same outlet that the Commerce Department had begun issuing H20 licenses last week, days after Nvidia Chief Executive Officer Jensen Huang met with Trump.
Huang has lobbied long and hard for the lifting of restrictions, arguing that walling China off will only slow the spread of American technology and encourage local rivals such as Huawei Technologies Co.
“It’s a strategic bargaining chip” that tightens Washington’s grip on a critical tech sphere during trade negotiations with China, said Hebe Chen, an analyst with Vantage Markets in Melbourne. “Over time, this hurdle for chips entering China will likely deter Nvidia and AMD from deeper expansion in the world’s largest chip-importing market, while giving local Chinese producers a clear edge to capture market share and accelerate domestic semiconductor innovation.”
If Washington goes ahead with the tax, it should funnel some capital to the US — but not an enormous amount in relative terms. Both Nvidia and AMD have said it’ll take time to ramp back up production of their China-specific products — even if order levels return to previous levels, which is uncertain.
Michael Kratsios, Director of the White House Office of Science and Technology Policy, comments on plans for location tracking for chips.
Nvidia raked in $4.6 billion of revenue from the H20 in the fiscal quarter ended April 27 — days after new restrictions on shipping the AI accelerator to China were imposed.
It also said it had been unable to ship $2.5 billion of H20 China revenue in that period because of the new rules. That implies it would have got more than $7 billion in H20 sales to China during the period. If it can return to that level, the US government will stand to get about a billion dollars a quarter from its deal.
China Is One of the Largest Markets for Nvidia and AMD
Total sales by company
Source: Bloomberg
Note: Sales figures for the 12 months ending on Jan. 26, 2025, for Nvidia and Dec. 28, 2024, for AMD
AMD could generate $3 billion to $5 billion of 2025 revenue if restrictions were lifted, Morgan Stanley estimates. Chinese alternatives such as Huawei’s Ascend chips now account for 20% to 30% of domestic demand, it reckoned.
“The US government clearly needs the money given its deficits and eagerness to collect tariffs,” said Vey-Sern Ling, managing director at Union Bancaire Privee in Singapore.
“But the complication is China’s accusations about H20 chips containing backdoors, which could be a negotiation tactic to highlight that the country is not ‘hard up’ for US chips.”
— With assistance from Debby Wu, Winnie Hsu, Jessica Sui, Wendy Benjaminson, Kevin Whitelaw, Shadab Nazmi, and Yasufumi Saito |
