An unconventional plan by the Trump administration to charge a 15% commission on Nvidia Corp. AI chip sales to China hasn’t progressed beyond the early stages and could pose legal risks, according to the company.
The US government hasn’t indicated how it will put regulations in place that require the chipmaker to make the payments, Nvidia said late Wednesday. Discussions between Nvidia and the government are ongoing, according to Chief Financial Officer Colette Kress.
The administration aims to take the 15% commission in return for allowing Nvidia and rival Advanced Micro Devices Inc. to offer AI chips in China again. The US government had blocked such sales in April, before agreeing to grant the necessary licenses earlier this month.
If the plan isn’t codified, Nvidia should be able to proceed with China sales without paying the commission, Kress said in an interview. “We have been communicating,” she said. “If nothing shows up, I’ve got licenses. I don’t have to do this 15% until I see something that is a true regulatory document.”
Spokespeople for the White House and the Commerce Department, which oversees US export control programs, didn’t immediately respond to requests for comment.
Nvidia’s products are at the center of a geopolitical rivalry between Washington and Beijing. Previous restrictions had all but locked Nvidia out of the Chinese market for AI processors, but it’s beginning to get permission to reestablish sales. For now, Nvidia isn’t including the revenue in its projections.
Nvidia also acknowledged that the US government’s commission plan presents its own dangers.
“Any request for a percentage of the revenue by the USG may subject us to litigation, increase our costs, and harm our competitive position and benefit competitors that are not subject to such arrangements,” Nvidia said in a filing.
The chipmaker has been walking a difficult line in trying to keep both Washington and Beijing happy. Nvidia and its peers have argued that being excluded from China hurts their home country because it creates opportunity for rivals in China. The restrictions also deprive US companies of revenue needed to fund research that keeps them in the lead, they say.
On Wednesday, Nvidia gave a forecast for the current quarter that wasn’t as bullish as some analysts had anticipated. The company said it excluded as much as $5 billion of possible China data center sales from its projection because it can’t be sure whether geopolitical tension will allow Nvidia to fill orders.
Kress said she believes some of that revenue will come in over time, but can’t be certain of the amount or timing.
Nvidia had designed the less-powerful H20 to comply with export restrictions imposed by the Biden administration, only to see the Trump White House further tighten those curbs in April. The move forced the chipmaker to record a $4.5 billion writedown on unsold H20 inventory in its first-quarter results in May.
The company is now looking ahead to a new generation of AI chips based on its Blackwell design that it could tailor for China. Trump has said that he’s open to this idea.
“The opportunity for us to bring Blackwell to the China market is a real possibility,” Chief Executive Officer Jensen Huang said during a conference call Wednesday. “We just have to keep advocating the sensibility of and the importance of American tech companies to be able to lead and win the AI race.”
RECOMMENDED FOR YOU
Trump’s Pay-For-Play Chips Deal Generates Alarm And Optimism
Aug 14, 2025
Chinese Tech 'Piggybacking' From US, Says Treasury Secretary Bessent
Aug 13, 2025
Nvidia, AMD Reach Deal To Give US A Cut Of China AI Chip Sales
Aug 12, 2025
Nvidia CEO Huang Says China’s Military Unlikely To Use US AI Chips
Jul 14, 2025
POPULAR