Nvidia and AMD have agreed to pay 15% of their chip revenue from China to the US government.
As per BBC report on Sunday, August 10, Nvidia and AMD, two of the biggest chip companies, have agreed to give 15% of their semiconductor sales revenue in China to the US government.
Nvidia told the BBC, “We follow rules the US government sets for our participation in worldwide markets. While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.”
“America cannot repeat 5G and lose telecommunication leadership. America's (artificial intelligence) tech stack can be the world's standard if we race,” the Chinese tech giant added.
The agreement is part of a deal that will grant export licences for selling advanced chips like Nvidia's H20 and AMD's MI308 in China, the second biggest economy in the world.
As per the agreement first reported by the Financial Times, Nvidia will pay 15% of revenues from H20 chip sales, and AMD will hand over the same percentage of the revenue from MI308 chip revenues.
US President Donald Trump’s administration in April banned the sale of Nvidia H20 chips to China over tech tensions and security concerns. However, the company last month announced that America will soon allow the company to resume AI chip sales.
Notably, both of the chip companies have a huge market in China. Nvidia recorded $17 billion in revenue from China in the fiscal year ending January 26, 13% of their total sales, while AMD generated $6.2 billion in 2024, 24% of their total revenue.
