TMTPOST -- U.S. President Donald Trump suggested he previously required Nvidia Corporation to make more concessions than the recently reported when the artificial intelligence (AI) chip giant were seeking export licenses for China-tailored chips.
Credit：China Central Television
Trump on Monday confirmed reports that Nvidia will be allowed to sell certain AI chips to China, in exchange for giving the U.S. government 15% of the revenue they get from the sales. He said he originally asked Nvidia for a 20% cut of its chip sales to China, but lowered the share of revenue to 15% after its CEO Jensen Huang negotiated with him.
Trump on Monday called Nvidia’s H20 an “old chip that China already has” and “obsolete.” “So I said, ‘listen, I want 20% if I’m going to approve this for you, for the country,’” Trump said at a news conference in Washington,referring to his meeting talk with Huang. H20 is the microprocessor that Nvidia had specially tailored to the Chinese market to comply with the Biden-era AI chip export controls.
Trump said he wouldn’t allow Blackwell, Nvdia’s latest advanced AI chip, to be sold to China without significant downgrade, such as a 30% or 50% cut in performance. And he indicated he could allow the company to sell the scaled-down Blackwell.
"Jensen also has the new chip, the Blackwell. A somewhat enhanced-in-a-negative-way Blackwell. In other words, take 30% to 50% off of it," said Trump. "I think he’s coming to see me again about that, but that will be an unenhanced version of the big one," he added.
Huang during his trip to China last month unveiled his company had obtained approval from the Trump administration to resume sales of its H20 chips to China. The U.S. Commerce Department was reported to have started issuing licenses for the sale of H20 chips to China on Friday, two days after Huang met Trump. Washington does not feel the sale of H20 and equivalent chips compromises national security, Reuters cited a U.S. official on Sunday.
Trump made the remarks after Nvidia and its competitor Advanced Micro Devices Inc. (AMD) were reportedly to agree to pay part of their revenue from China to the U.S. government as part of a deal the Trump administration to secure export licenses.
The Financial Times (FT) on Sunday cited a U.S. official as saying that Nvidia would share 15% of the revenue from sales of its H20 chips in China and AMD will share the same share from MI308 revenues. Bloomberg later echoed the report, noting the agreement Nvidia and AMD struck with the U.S. government were unusual if not unprecedented arrangement that stands to unnerve US companies and Beijing alike.
Nvidia responded to these reports, saying that"We follow rules the US 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," it added.
Chinese Foreign Ministry spokesperson Lin Jian dodged the query for comments on the reported deal between the Trump administration and Nvidia or AMD. China has made its position clear more than once on the U.S. export of chips to China, said Lin at a press conference on Monday.
Some former government officials and trade lawyers say the arrangement that gives a slice of companies’ revenue from chip sales in China isn’t just unprecedented but may be illegal.
“We’re far beyond uncharted waters. We’re in an uncharted universe,” said Doug Jacobson, an international trade attorney for Jacobson Burton Kelley, who said he and his colleagues were “aghast” at the arrangement. The State Department can charge fees for export licenses related to defense technology, but those fees aren’t based on revenue earned, Jacobson said.
“No fee may be charged with consideration of any application for a license. This could run afoul of that,” said Aiysha Hussain, a partner at law firm Mayer Brown who served as a senior advisor at the BIS between 2021 and 2024.
“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.
While both Nvidia and AMD already said they would start shipping to China, the big question is exactly when they’re going to start delivering to China again, especially now that there are strings attached, commented Jay Goldberg, an analyst at Seaport Global Securities.
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