H200 AI Chip Sales to China Approved, but U.S. Takes a 25% Cut

SAN FRANCISCO:  In a major win for the U.S. technology sector, President Donald Trump announced on Monday that AI chip giant Nvidia will be permitted to sell its advanced H200 semiconductors to “approved commercial customers” in China. The decision, which also applies to rivals like AMD, partially reverses the previous ban on advanced chip exports to Beijing.

The reversal follows extensive lobbying efforts by Nvidia boss Jensen Huang, and comes with a highly unusual financial condition: Trump declared in a social media post that “25% [sic] will be paid to the United States of America.”

Nvidia, the world’s most valuable company, immediately praised the decision, which caused its shares to rise slightly. “Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America,” Nvidia said in a statement.

Trump justified the move by stating the policy will “protect National Security, create American Jobs, and keep America’s lead in AI.” The decision also creates leverage for the U.S. in broader trade negotiations. Alex Capri from the National University of Singapore noted that the sale “buys time” for the U.S. to negotiate a deal with Beijing over rare earths, minerals essential for electronics production, where China holds a near-monopoly on processing.

The H200 is one generation behind Nvidia’s most advanced chip, the Blackwell, ensuring the U.S. maintains a critical technological lead while still allowing competition in the vast Chinese market. CEO Jensen Huang has repeatedly warned that China is close behind the U.S. in chip development and needs access to the technology to prevent it from fully developing a domestic replacement.

Despite the concession, analysts expect China to continue efforts to reduce dependence on the U.S. Beijing had previously directed local tech firms to reject Nvidia’s older chips and encouraged the purchase of domestically produced alternatives. While H200 access will benefit China’s technology sector, the long-term goal remains self-sufficiency.