Nvidia, AMD Agree to 15% Revenue Share on China GPU Sales

Under the Trump administration in 2025, Nvidia and AMD secured export licenses to sell mid-tier AI chips such as Nvidia's H20 and AMD's MI308 to China by agreeing to pay 15% of their China-derived sales revenue to the U.S. government. This revenue-sharing deal allows both companies to regain critical market access after prior restrictions caused significant revenue drops, with Nvidia projecting $23 billion in H20 sales in China for 2025, resulting in an estimated $3.45 billion payment to the U.S. Treasury. While this arrangement sustains U.S. chipmakers' presence in the Chinese market and helps avoid ceding ground to competitors like Huawei or SMIC, it reduces profitability amid already thin margins and intense competition. The agreement represents a strategic compromise balancing market access against financial concessions, but it introduces geopolitical risk and uncertainty, as future U.S.-China relations could tighten export controls or increase revenue shares. Investors and national security experts are closely watching the long-term implications for global AI competitiveness, with debates ongoing about the potential indirect acceleration of China's AI capabilities despite compliance with export restrictions. Overall, this deal marks a new frontier in how geopolitical considerations are directly priced into semiconductor industry operations and stock valuations.