Trump Announces AI Chip Deal With China, US to Get 25% Sales Revenue

President Donald Trump announced Monday the US will allow Nvidia to export its H200 artificial intelligence chips to "approved customers" in China and other countries.

The Details: Under the proposal, the federal government will receive 25% of revenue from the sales, though no agreement has been signed yet. Trump said on Truth Social the Commerce Department is finalizing the policy, which he said would protect national security while supporting US jobs and manufacturing. Trump also said President Xi Jinping responded positively" to the deal. Nvidia CEO Jensen Huang, who has lobbied for relaxed export rules, said it remains unclear whether China will accept H200 chips because they are older than Nvidia's latest offerings. Nvidia shares rose 2% on early reports of impending approval.

For Context: US export controls on advanced AI chips were tightened over the last two years to limit China's access to high-performance processors. In response, companies like Nvidia and AMD developed lower-specification chips like the H20 to comply with those rules, though China warned firms against using them earlier this year. Trump has criticized prior restrictions under the Biden administration as harmful to innovation and US industry. According to the Institute for Progress, Nvidia's H200 chips are six times more powerful than the H20 chips previously permitted for export under a separate agreement where Nvidia and AMD agreed to share 15% of China-related revenue with the US government. 

How the Media Covered It: CNBC (Lean Left bias) noted past trade disagreements between the US and China, writing semiconductors are at the center of the AI race between both countries, and have played a role in their "tumultuous" trade relationship. The New York Post (Lean Right) mentioned fears about the chips helping Beijing "supercharge" its military. It highlighted criticism from Sen. Elizabeth Warren (D-Ma.) saying Huang "got his wish to sell the most powerful AI chip we've ever sold to China." The Hill (Center) also said the decision is likely to face pushback within the GOP over national security fears.

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