Nvidia and AMD Agree to Share Revenue for U.S. Licenses to Sell High‑End AI Chips in China

Revenue‑Sharing Licenses Enable Chinese Sales

Nvidia and AMD have each reached agreements with the United States government that allow them to sell high‑end artificial‑intelligence chips in China. Under the terms, the companies will remit a share of the revenue generated from those sales back to the U.S. Treasury. Nvidia’s agreement covers its H20 AI chips, and AMD’s agreement involves a cut of sales of its MI308 chips.

Background of Export Controls

Earlier this year, the U.S. administration placed restrictions on the export of certain high‑performance AI inference chips to China, citing national‑security concerns. Those restrictions were later paused after Nvidia pledged to invest heavily in U.S. data‑center infrastructure. The pause opened the door for the current licensing arrangement, which formalizes a revenue‑sharing model in exchange for export approval.

Details of the Agreements

Both companies will pay the U.S. government 15% of the revenue they earn from the specified chip sales in China. The revenue share is intended to offset concerns about strategic technology transfer while still permitting commercial activity. The government has begun issuing the necessary licenses for the two firms, signaling a shift from outright bans to a managed‑export approach.

Corporate Responses

Nvidia stated that it follows the rules set by the U.S. government for participation in global markets. While it has not shipped the H20 chips to China for several months, the company expressed hope that the export‑control framework will enable continued competition worldwide. AMD has not issued a detailed comment, but its participation in the revenue‑sharing model mirrors Nvidia’s compliance stance.

Political and Trade Context

The licensing decision coincided with broader trade discussions between the United States and China, including negotiations over rare‑earth elements that are essential for components such as rechargeable batteries used in electric vehicles. U.S. Commerce Secretary Howard Lutnick linked Nvidia’s policy shift to those trade talks.

Criticism and Security Concerns

Despite the agreements, national‑security experts and former government officials have written to the Commerce Secretary urging a reversal of the policy. They argue that allowing high‑performance AI chips to enter China, even under a revenue‑sharing scheme, could pose strategic risks.

Outlook

The revenue‑sharing licenses represent a nuanced approach to balancing commercial interests with security considerations. As the agreements take effect, the extent to which they satisfy both economic and strategic objectives will likely be monitored closely by policymakers, industry leaders, and security analysts.