President Donald Trump said Monday that the U.S. will allow tech giants into the country. Nvidia The company will ship its H200 artificial intelligence chips to “approved customers” such as China under a series of conditions.
Chinese President Xi Jinping “reacted positively” to the proposal, Trump wrote in a post on Truth Social.
According to Trump’s post, 25% of the chip sales will be paid to the U.S. government as part of the agreement, which the president said will allow for “a continued strong national security.”
Nvidia and chip rivals advanced micro device In August, the company agreed to share 15% of its revenue from chip sales in China with the U.S. government.
Nvidia stock rose early Monday on news that the Commerce Department plans to approve the sale to China, but later pared its gains. Shares rose about 1% after hours.
“We applaud President Trump’s decision to allow the U.S. chip industry to compete to support America’s high-wage jobs and manufacturing,” an Nvidia spokesperson told CNBC in a statement.
“Offering the H200 to commercial customers, vetted and approved by the Department of Commerce, strikes a thoughtful balance and is great for the United States,” the spokesperson said.
Semiconductors are a key component in nearly every category of electronics and are at the center of the AI race between the US and China.
It has also played a role in the turbulent trade relationship between the two economic powers.
When Beijing imposed export restrictions on rare earth minerals used to make some high-end semiconductors, the Trump administration threatened to significantly increase U.S. tariffs on Chinese imports.
After meeting in South Korea in late October, Trump and Xi signed an interim trade truce in which China pledged to stop “retaliating” against U.S. chipmakers, the White House said.
After the meeting, Trump said he had discussed exporting Nvidia chips with Xi.
In August, China warned companies not to use Nvidia’s H20 AI chip designed specifically for the country. Although the H200 is a higher grade chip than the H20, it is not the company’s top-of-the-line product.
Nvidia did not immediately respond to CNBC’s request for comment.
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—CNBC’s Kristina Partinevelos and Kif Leswing contributed to this report.
