Trump allows Nvidia to sell second-class AI chips to China

Nvidia will soon be allowed to deliver H200 AI accelerators to the People's Republic of China, albeit only to specific customers selected by the US government. US President Donald Trump announced this on Monday in online postings. However, Nvidia will reportedly have to pay 25 percent of the revenue as a penalty tax to the US Treasury.

According to Trump, a similar fate awaits the partly state-owned chip company Intel, its competitor AMD, and other US companies. It is not an export duty in the strict sense, because most chips are not manufactured in the USA anyway, so they do not have to be exported from there. Nvidia's chips are produced by TSMC in Taiwan.

Trump has justified the previous sales ban with concerns about the national security of the United States of America. He does not want the People's Liberation Army of the People's Republic of China to receive Nvidia's most powerful AI chips.

H200 instead of H20

Until now, Nvidia was allowed to sell the model H20, specially developed for the Chinese market, there, but Beijing rejected it. The Chinese government sees deliberately built-in security vulnerabilities and also fears that the USA could deactivate the H20 chips remotely in the event of an escalation of the conflict. H200 is a more powerful model but not as efficient as the Blackwell series (GB100, GB102, GB200). Trump explicitly wants to reserve the Blackwells exclusively for US customers.

It remains unclear why the 25 percent revenue share can allay previous national security concerns. Nvidia doesn't mind. The management is showering Trump with praise for the new sales permit. It is also unclear whether the new penalty tax is in addition to the 15 percent paid by Nvidia and AMD since August, or whether only ten percentage points are added or more.

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