Nvidia Corp and Advanced Micro Devices Inc (AMD) have agreed to pay 15 percent of their revenue from Chinese artificial intelligence (AI) chip sales to the US government in a deal to secure export licenses, an unusual arrangement that might unnerve both US companies and Beijing.
Nvidia plans to share 15 percent of the revenue from sales of its H20 AI accelerator in China, a person familiar with the matter said. AMD is to deliver the same share from MI308 revenue, the person added, asking for anonymity to discuss internal deliberations.
The arrangement reflects US President Donald Trump’s consistent effort to engineer a financial payout for the US in return for concessions on trade. His administration has shown a willingness to relax trade conditions such as tariffs in return for giant investment in the US — as with Apple Inc’s pledge to spend US$600 billion on domestic manufacturing — but such a narrow, select export tax has little precedent in modern corporate history.
Photo: Tyrone Siu, Reuters
“This seeming quid pro quo is unprecedented from an export control perspective. The arrangement risks invalidating the national security rationale for US export controls,” said Jacob Feldgoise, a researcher at the Washington-based Center for Security and Emerging Technology.
It “will likely undermine the US’ position when negotiating with allies to implement complementary controls,” he said. “Allies may not believe US policymakers if they are willing to trade away those same national security concerns for economic concessions — either from US companies or foreign governments.”
An Nvidia spokesperson said the company follows US export rules, adding that while it has not shipped H20 chips to China for months, it hopes the rules would allow US companies to compete in China.
AMD did not immediately respond to a request for comment.
The Financial Times earlier reported the development.
It followed a separate report from the same outlet that the US Department of Commerce had begun issuing H20 licenses last week, days after Nvidia chief executive officer Jensen Huang (黃仁勳) met with Trump.
Huang has lobbied long and hard for the lifting of restrictions, arguing that walling China off would only slow the spread of US technology and encourage local rivals such as Huawei Technologies Co (華為).
“It’s a strategic bargaining chip” that tightens Washington’s grip on a critical technology sphere during trade negotiations with China, said Hebe Chen (陳碧菲), an analyst with Vantage Markets Pty Ltd in Melbourne.
“Over time, this hurdle for chips entering China will likely deter Nvidia and AMD from deeper expansion in the world’s largest chip-importing market, while giving local Chinese producers a clear edge to capture market share and accelerate domestic semiconductor innovation,” Chen said.
If Washington goes ahead with the tax, it should funnel some capital to the US, but not an enormous amount in relative terms. Both Nvidia and AMD have said it would take time to ramp back up production of their China-specific products — even if order levels return to previous levels, which is uncertain.
JITTERS: Nexperia has a 20 percent market share for chips powering simpler features such as window controls, and changing supply chains could take years European carmakers are looking into ways to scratch components made with parts from China, spooked by deepening geopolitical spats playing out through chipmaker Nexperia BV and Beijing’s export controls on rare earths. To protect operations from trade ructions, several automakers are pushing major suppliers to find permanent alternatives to Chinese semiconductors, people familiar with the matter said. The industry is considering broader changes to its supply chain to adapt to shifting geopolitics, Europe’s main suppliers lobby CLEPA head Matthias Zink said. “We had some indications already — questions like: ‘How can you supply me without this dependency on China?’” Zink, who also
At least US$50 million for the freedom of an Emirati sheikh: That is the king’s ransom paid two weeks ago to militants linked to al-Qaeda who are pushing to topple the Malian government and impose Islamic law. Alongside a crippling fuel blockade, the Group for the Support of Islam and Muslims (JNIM) has made kidnapping wealthy foreigners for a ransom a pillar of its strategy of “economic jihad.” Its goal: Oust the junta, which has struggled to contain Mali’s decade-long insurgency since taking power following back-to-back coups in 2020 and 2021, by scaring away investors and paralyzing the west African country’s economy.
BUST FEARS: While a KMT legislator asked if an AI bubble could affect Taiwan, the DGBAS minister said the sector appears on track to continue growing The local property market has cooled down moderately following a series of credit control measures designed to contain speculation, the central bank said yesterday, while remaining tight-lipped about potential rule relaxations. Lawmakers in a meeting of the legislature’s Finance Committee voiced concerns to central bank officials that the credit control measures have adversely affected the government’s tax income and small and medium-sized property developers, with limited positive effects. Housing prices have been climbing since 2016, even when the central bank imposed its first set of control measures in 2020, Chinese Nationalist Party (KMT) Legislator Lo Ting-wei (羅廷瑋) said. “Since the second half of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) received about NT$147 billion (US$4.71 billion) in subsidies from the US, Japanese, German and Chinese governments over the past two years for its global expansion. Financial data compiled by the world’s largest contract chipmaker showed the company secured NT$4.77 billion in subsidies from the governments in the third quarter, bringing the total for the first three quarters of the year to about NT$71.9 billion. Along with the NT$75.16 billion in financial aid TSMC received last year, the chipmaker obtained NT$147 billion in subsidies in almost two years, the data showed. The subsidies received by its subsidiaries —
RSS