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President Donald Trump has decided to let Nvidia export its H200 chip to China, in a move that has sparked concern among some security officials and lawmakers over access to advanced technology used for artificial intelligence.
“I have informed President Xi [Jinping], of China, that the United States will allow NVIDIA to ship its H200 products to approved customers in China, and other Countries, under conditions that allow for continued strong National Security. President Xi responded positively!” Trump posted on Truth Social on Monday.
The president added “$25% will be paid to the United States of America” without giving details of the arrangement.
Trump said the “same approach” to allowing chip exports would apply to rivals such as AMD and Intel.
Nvidia’s sales of advanced chips used for AI to Chinese customers have halted this year, caught between US export restrictions and a backlash from Beijing against American technology.
The export control breakthrough could represent a multibillion-dollar revenue boost for the chip giant if it goes ahead and China permits its companies to buy them. Nvidia shares rose 1.73 per cent on Monday after Semafor first reported the administration’s decision. Its stock rose another 2 per cent after markets closed.
However, sales of Nvidia chips in China could face opposition in US Congress and be hampered by Chinese authorities.
Nvidia chief executive Jensen Huang last week said he was unsure if China would accept the H200.
Nvidia’s H200 chip is far more powerful than the H20 chip that was made specifically for export to China, but belongs to the previous generation of its technology since replaced by its latest Blackwell chips.
The chipmaker previously agreed to pay the US government a 15 per cent cut of its revenue from chip sales to China in a deal to resume H20 exports, but that agreement was not finalised.
Trump’s announcement comes days after a bipartisan group of senators introduced legislation that would prevent the administration from approving exports of advanced chips, including the H200, to China for 30 months.
The senators — including Republican Pete Ricketts and Democrat Chris Coons — said the bill was designed to ensure the US maintained its dominance in AI by denying critical technology to China.
Huang and David Sacks, the White House AI tsar, argue restricting exports of US chips handicaps American companies and hurts efforts to make the world reliant on American AI chips and technology.
Critics say the White House is providing China with a huge boost in an industry that has significant military applications.
“Selling large numbers of H200s to China will give rocket fuel to the Chinese AI industry,” said Chris McGuire, a tech expert at the Council on Foreign Relations who had senior White House and state department roles in Joe Biden’s administration.
McGuire added Chinese tech group Huawei “admits it cannot build a chip better than the H200 for at least two years. This will give Chinese AI firms the computing power they need to close the gap with the US.”
The decision signals a big shift from the Biden administration’s approach, which imposed sweeping export controls on chip-related technology in an effort to slow the modernisation of China’s military.
It comes as US government agencies have been told not to take actions that would anger China because Trump does not want to jeopardise his relationship with Xi and his planned visit to Beijing in April.
The H200, released in 2023, is a more powerful version of the ‘Hopper’ chip that was behind the explosive debut of OpenAI’s ChatGPT in 2022. The Biden administration banned those chips from export to China.
The Hopper chips continue to sell around the world and recorded $2bn in revenue in the most recent quarter.
To comply with US export controls, Nvidia has in the past designed lower-performance AI chips specifically for the Chinese market, until new licensing requirements on its H20 China chip earlier this year from Washington.
Beijing has since put pressure on domestic tech companies not to buy these chips, cutting off billions of dollars in potential revenue for Nvidia.
Trump on Monday wrote: “The Biden Administration forced our Great Companies to spend BILLIONS OF DOLLARS building “degraded” products that nobody wanted, a terrible idea that slowed Innovation, and hurt the American Worker. That Era is OVER!”
Last week, Huang said he could not continue to “degrade” chips for the China market, which is both unacceptable to Chinese leadership and businesses.
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