Miranda Jeyaretnam
The world’s most valuable company is now at the center of President Donald Trump’s trade war with China.
Trump said Monday that he has cut a deal with chipmaker Nvidia, allowing it to sell certain artificial intelligence chips to China in exchange for a cut of the revenue, which would go to the U.S. government. Trump said he also negotiated a similar deal with chipmaker Advanced Micro Devices (AMD).
The deal is a marked departure from an effort by the U.S. to restrict China’s access to advanced semiconductors over concerns that they would be used to advance the country’s military technology. Washington began restricting exports of some semiconductors to China in 2022, although Nvidia was able to export a specially made-for-China chip, the H20, which is deliberately slowed down.
In April, the Trump Administration announced that it would require a license to export the H20 chip, abruptly curbing the shipment of $2.5 billion of H20 revenue from China in the fiscal quarter ending April 27. The announcement spurred months of lobbying by Nvidia CEO Jensen Huang, who committed a $500 billion investment from Nvidia to make AI servers in the U.S. Last month, Nvidia announced that it would resume sales of the H20 to China after Trump and Huang met in the Oval Office, and the Commerce Department began licensing the chips for export last week.
But the unusual deal is not just a return to the previous status quo—rather, analysts and lawmakers warn that it could open the doors to a “pay-to-play” trade policy. Here’s what to know.
What the deal means for Nvidia
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