Trump Approves Nvidia's Advanced Chip Sales to China

In a significant move, President Donald Trump has given the green light for Nvidia, based in California, to distribute its advanced H200 computer chips to certain authorized Chinese buyers, boosting the role of the semiconductor powerhouse, especially in artificial intelligence applications.

The transaction means the U.S. government will receive a 25% revenue share of these chip sales to China, as announced by President Trump in his statement.

Excluded from this agreement are Nvidia's more sophisticated Blackwell processors and the next generation systems, which the president clarified.

Trump mentioned he had discussed the matter with Chinese President Xi Jinping, who reacted positively to the news. The sales will proceed in a manner that simultaneously ensures robust national security, according to Trump.

The Department of Commerce is currently working on finalizing the specifics of the agreement, with Trump noting that similar terms may apply to other American chip-producing firms, such as AMD and Intel.

A spokesperson from Nvidia appreciated the president's decision, considering it a balanced approach beneficial to the U.S.

Nvidia is renowned for developing complex processors vital for artificial intelligence functions. The recent surge in AI technology has transformed Nvidia into the most valuable publicly traded enterprise in the United States, boasting a market value of around $4.5 trillion as of Monday.

Both the Biden and preceding Trump administrations had limited exports to certain Chinese organizations, citing concerns about potential military uses or aiding China's AI sector's growth in ways that could conflict with U.S. interests. These restrictions reflect bipartisan caution over AI chip exports, focused on both national security and maintaining the U.S. lead in AI technology over China.

Nvidia has faced challenges regarding the Chinese market. CEO Jensen Huang has expressed that U.S. export controls have counterproductively encouraged China to develop its own independent AI chip industry.

Huang has reportedly engaged in several discussions with Trump regarding the oversight of exports.

Previously, in August, the Trump administration agreed to grant export licenses to Nvidia and AMD, with the condition of the U.S. government obtaining 15% of revenues from sales to China. Additionally, the government planned to acquire a 10% stake in Intel, contingent on federal incentives to enhance semiconductor production.