Nvidia, AMD May Sell High-End AI Chips to China if They Pay US a Cut

The landscape of the global AI chip race appears to be shifting, with reports indicating that semiconductor giants Nvidia and AMD may soon be permitted to sell their high-end AI chips to China, provided they agree to a new revenue-sharing arrangement with the U.S. government. According to a Financial Times report citing anonymous sources, this new framework involves Nvidia and AMD paying 15% of the revenue generated from these specific chip sales to the U.S. government in exchange for export licenses.

Sources familiar with the matter suggest that Nvidia would share revenues from its H20 AI chips, while AMD would offer a portion of income from its MI308 chip sales. The U.S. government has reportedly begun issuing the necessary licenses for these transactions, signaling a potential easing of previous restrictions.

This development follows a period of regulatory flux. The Trump administration had initially imposed restrictions on certain high-performance AI inference chips to China in April, a ban that was later paused. At that time, Nvidia committed to significant data center investments within the United States. Subsequently, in July, Nvidia announced plans to resume sales of its H20 AI chips, which were specifically designed for the Chinese market after restrictions were put in place by the Biden administration.

Responding to the situation, an Nvidia spokesperson stated, “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.”

U.S. Commerce Secretary Howard Lutnick has indicated that Nvidia’s shift in strategy regarding China chip sales is connected to ongoing trade discussions between the U.S. and China, particularly concerning rare-earth elements. These elements are critical components for manufacturing various technological products, including rechargeable batteries for electric vehicles.

However, the administration’s decision to potentially approve these sales has drawn criticism. National security experts and former government officials have voiced their concerns, writing to Secretary Lutnick last month to urge the government to reconsider its course of action and maintain stricter export controls.

This article was updated to include a statement from Nvidia.