Trump says he asked for 20% cut from Nvidia, calls H20 an 'obsolete' chip

In a recent press conference, former President Donald Trump disclosed that he had initially requested a 20% cut of Nvidia's sales to China, a figure that was later negotiated down to 15% by CEO Jensen Huang. This revelation followed Nvidia's announcement that it had agreed to pay this 15% fee to the U.S. government in exchange for export control licenses that would enable the company to resume sales of its H20 chip to Chinese markets. During the briefing, Trump characterized the H20 chip as outdated, claiming it was already in China's possession and deemed 'obsolete.' He contrasted it with Nvidia's latest AI chip, known as Blackwell, which he asserted would not be available for sale to China without significant modifications that could reduce its performance by as much as 50%. "The Blackwell is super-duper advanced. I wouldn't make a deal with that," he stated, suggesting that a downgraded version could be a possibility. The motivation behind strict U.S. export controls stems from concerns that supplying advanced technology to China could enable them to surpass the U.S. in AI advancements, potentially threatening national security. Trump claimed that China already possesses chips with capabilities similar to those of the H20, while Huang has argued that it would be better for U.S. security if Chinese developers utilize American technology. He suggested that restricting access to Nvidia's chips might inadvertently boost the Chinese chip industry’s development. The H20 chip, tailored for the Chinese market, has been intentionally throttled in performance and is linked to Nvidia's H100 and H200 models used within the United States. The Biden administration's export restrictions on AI chips, implemented in 2023, had already affected Nvidia's plans. In April, the Trump administration announced licensing requirements for H20 exports, which Huang described as effectively closing the market to Nvidia. Despite having halted shipments of the H20 to China for several months, an Nvidia spokesperson expressed hope that new export control regulations would allow the company to compete both in China and globally. Trump also mentioned that Huang plans to return for further discussions regarding export licenses for the Blackwell chips. A White House official confirmed that AMD, another leading AI chip manufacturer, will similarly pay a 15% fee to secure an export license for its AI chip, the Instinct MI308, aimed at the Chinese market.