The AI chip race narrative was once about U.S. nationwide safety, however apparently now it’s about tariffs: Nvidia and AMD have agreed to pay the U.S. authorities 15% of the income they make from gross sales of high-end AI chips to China in change for licenses to promote to these chips within the nation, the Monetary Occasions reported, citing nameless sources.
In accordance with the FT’s authorities supply, Nvidia will share revenues from gross sales of its H20 AI chips in China, and AMD would share a lower of MI308 chip gross sales. The federal government has additionally began issuing licenses for the sale of the 2 corporations’ chips, the report stated.
The Trump administration in April had restricted gross sales of sure high-performance AI inference chips to China, however paused the ban a few months later, when Nvidia promised to make as much as $500 billion price of information middle investments stateside. Then in July, the corporate stated it might resume gross sales of its H20 AI chips to China, which it had designed particularly on the market within the nation following restrictions by the Biden administration.
In accordance with U.S. Commerce Secretary Howard Lutnick, Nvidia’s change after all was associated to commerce discussions with China concerning rare-earth components, that are essential for making elements, like rechargeable batteries for electrical automobiles.
The administration’s resolution to approve the sale of Nvidia’s H20 chips has its critics: nationwide safety specialists and former authorities officers wrote to Lutnick final month, urging the federal government to reverse course.
