Nvidia and AMD have agreed to give the US government 15% of revenues from chip sales in China in exchange for receiving export licenses to sell certain advanced chips in China, according to reporting by the Financial Times.
The export licenses will apply to sales in China of Nvidia’s H20 and AMD’s MI308 chips, according to the report.
The arrangement drew strong criticism from many tech analysts. Bernstein Research analyst Stacy Rasgon raised concerns about the precedent set by the Trump administration in what appears to be a " pay-to-play" scenario.
Analyst Jack Gold of J. Gold Associates called the 15% payment "pretty much extortion" on AI chip vendors and questioned why security issues were so important previously with sales of AI chips to China and now are not. "Why is it now OK?" he asked. "This is a rather scary strategy....Will all chips sold to China eventually have to pay-to-play?"
Potentially, the 15% could apply to Intel or other vendors, Gold said.
The unprecedented agreement comes as White House officials meet with officials from companies and foreign governments on a slew of new tariffs and export conditions and work to negotiate alternatives. FT reported Nvidia CEO Jensen Huang met with President Trump last week.
Trump had said last week he planned to impose a 100% tariff on imports of semiconductors unless a company is “building in the United States.”
Nvidia said in a statement: “We follow rules the US government sets for our participation in worldwide markets.”
The US Commerce Department started issuing the H20 licenses on Friday after Jensen had met with Trump, and reportedly began issuing licenses for AMD’s chip as well.
Before controls took effect on the H20 chips kicked in earlier in 2025, Nvidia was expected to sell about 1.5 million H20 chips to China in 2025, valued at about $23 billion, according to one analysis by Bernstein. Former President Biden had originally imposed tough export control on advanced chips used in AI, and Nvidia then began selling the H20 to China without technology that forced the ban.
The ban on the H20 began in April under Trump, but was reversed in June after Huang met with Trump and still no licenses were issued by the Bureau of Industry and Security. Then Huang me with Trump on Wednesday and the licenses began being issued on Friday, according to FT’s reporting.
A group of 20 security experts had urged the US not to grant the H20 licenses on the grounds the chips would help China’s AI capabilities that would ultimately be used by the Chinese military. Nvidia told the FT on Saturday that it had not shipped H20 to China for months, but added in a statement to Fierce and others: “We hope export control rules will let America compete in China and worldwide. America cannot repeat 5G and lose telecommunications leadership. America’s AI tech stack can be the world’s standard if we race.”
Chinese officials have been pushing for relaxing US controls on high-bandwidth memory chips, a component of advanced AI chips.