Nvidia and AMD to Pay 15% of China Chip Sales Revenue to US Government

Agreement on Chip Sales to China

• 🤝 Nvidia and AMD have reportedly agreed to pay 15% of their revenue from advanced computer chip sales to China to the US government.
• 💡 This arrangement is according to a US official who spoke to Reuters, concerning chips used for artificial intelligence applications.

US National Security and Export Licenses

• ⚠️ The US administration, citing national security concerns, had previously blocked sales of certain chips like Nvidia's H20 to China.
• 📈 The agreement is said to be a condition for obtaining export licenses for their semiconductors.
• 💰 The Trump administration has not yet determined how the collected revenue will be utilized.

Market Significance for Chipmakers

• 📊 China represents a substantial market for both companies, with sales to China accounting for 24% of AMD's total revenue in 2024 and 13% of Nvidia's sales in their last fiscal year.
• 💬 A spokesperson for Nvidia stated that the company follows the rules set by the US government for its participation in worldwide markets.