By John Meyer, consultant in financial affairs – Eurasia Business News, August 11, 2025. Article no. 1698
Nvidia and AMD have agreed to pay the U.S. government 15% of their revenue from sales of certain advanced AI chips in China as part of an export license condition. Specifically, this applies to Nvidia’s H20 chip and AMD’s MI308 chip, both important for AI applications.
This fee arrangement is unprecedented and acts like a revenue-sharing “tax” on these chip sales in China, established under the Trump administration’s export controls.
This deal allows Nvidia and AMD to sell these chips to the Chinese market after a period of suspension, providing market access despite the significant fee. Nvidia has stated it complies with U.S. government regulations and hopes the controls will enable the U.S. to compete globally, while AMD has not commented publicly yet.
Analysts see this as a net positive, as 85% of revenue (after the 15% cut) is better than losing access entirely to this large market. However, it reduces the companies’ profit margins on China sales and raises questions about future U.S. government demands if sales grow.
This arrangement reflects a novel export control strategy using economic leverage, aiming to balance restricting technology to China and allowing U.S. companies to benefit from China’s market under strict financial terms.
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On July 15 Nvidia secured approval from the U.S. government, under the Trump administration, to resume sales of its H20 AI chip to China, reversing the export ban imposed in April 2025. This permission follows extensive lobbying and a meeting between Nvidia CEO Jensen Huang and former President Donald Trump, with the administration committing to issuing export licenses soon.
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