President Donald Trump said Monday. Nvidia The H200 artificial intelligence chip will be allowed to be shipped to “approved customers” such as China, provided the U.S. receives a 25% tax break.
Chinese President Xi Jinping “reacted positively” to the proposal, Trump wrote in a post on Truth Social.
President Trump wrote that the policy “will support American jobs, strengthen American manufacturing, and benefit American taxpayers.”
“The Department of Commerce is finalizing details and a similar approach will continue to be applied.” AMD, inteland other great American companies,” he added in the post.
Abbreviation for Nvidia and chip rival AMD advanced micro deviceIn August, the company agreed to share 15% of its revenue from chip sales in China with the U.S. government. But around the same time, China reportedly 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 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 2% after hours.
Nvidia (NVDA) and Advanced Micro Devices (AMD) stock prices
“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.
—CNBC’s Kristina Partinevelos and Kif Leswing contributed to this report.
