US Government Secures 15% Revenue Share from Nvidia, AMD China AI Chip Sales

The Trump administration has struck an unprecedented deal with American chipmakers Nvidia and Advanced Micro Devices (AMD), requiring them to pay 15% of revenue from certain AI chip sales in China as a condition for obtaining export licenses. This arrangement, involving Nvidia's H20 and AMD's MI308 chips, marks a novel approach in U.S. trade policy by monetizing export permissions, a move critics argue could face constitutional challenges as it may be construed as an illegal export tax. The deal reflects Trump's broader transactional and interventionist economic strategy, which includes government stakes in private companies and strict conditions on foreign investments, signaling a shift toward a form of state capitalism. The policy contrasts with previous multilateral approaches, as it coincides with increased domestic semiconductor production incentives and expanded export controls aimed at maintaining U.S. technological leadership over China. However, this strategy risks undermining alliances and prompting other nations to reduce dependence on U.S. technology amid the ongoing strategic rivalry between Washington and Beijing. Nvidia and AMD have acknowledged compliance with U.S. regulations, though the White House has yet to specify how the collected revenues will be used.