President Donald Trump has raised alarm by suggesting he might allow Nvidia to sell a downgraded version of its advanced Blackwell chip in China, potentially loosening export restrictions that aim to prevent Beijing from using US technology to harm national security. The comments came during a briefing on Monday, where Trump also defended an unprecedented revenue-sharing deal with Nvidia and AMD for sales of previously banned chips to China.
Under that deal, Nvidia and AMD received export licenses to sell their H20 and MI308 chips to China in exchange for giving the US government 15% of sales revenue. Trump claimed he initially demanded 20% but accepted Nvidia CEO Jensen Huang's offer of 15%. The H20 and MI308 chips were banned in April under the Biden administration, but Nvidia recently won clearance to resume shipments.
Trump described the H20 as "obsolete" and a chip that "China already has in a different form." However, experts warned that the H20 remains highly capable for AI inference workloads, which are increasingly dominant in the field. Harry Krejsa of the Carnegie Mellon Institute for Strategy and Technology said lifting restrictions on H20s "means we are directly equipping Beijing with the tools it needs to compete on the AI frontier."
The revenue-sharing deal has drawn criticism from analysts and China hawks in Washington, who fear it could allow China to use advanced US technology against American interests. John Moolenaar, Republican head of the House China committee, expressed concern over the government taking a cut of proceeds from chip sales to China.
Trump also flagged the possibility of a 100% tariff on global semiconductors, with exemptions for companies investing in US manufacturing. Taiwan's TSMC recently announced a $100bn investment in the US, which Trump said secured a verbal agreement. The developments mark Trump's latest intervention in corporate decision-making, following pressure on executives to boost domestic production.
