Trump Reverses Course, Approves Nvidia H200 AI Chip Sales to China with 25% U.S. Cut

President Donald Trump announced Monday, December 8, 2025, a significant shift in U.S. tech export policy, approving the sale of Nvidia's advanced H200 artificial intelligence chips to China. This decision, shared via his Truth Social platform, overturns previous restrictions imposed by the Biden administration on such high-performance technology, according to The Guardian.

The groundbreaking agreement permits Nvidia to export these powerful chips to "approved customers" in China, with the United States government reportedly receiving a 25% cut of the proceeds. This move is seen as a substantial win for Nvidia, which has actively lobbied for greater access to the lucrative Chinese market, as reported by CBS News.

Trump stated that the policy aims to support American jobs, strengthen U.S. manufacturing, and benefit taxpayers, while still safeguarding national security. The Department of Commerce is currently finalizing the intricate details of this arrangement, which is expected to extend a similar approach to other American chipmakers like AMD and Intel, Xinhua reported.

The H200 chip represents Nvidia's second-most powerful offering, significantly more advanced than the H20 model previously designed for the Chinese market but later restricted. This decision marks a dramatic departure from the Biden administration's stringent export controls, which sought to limit China's access to cutting-edge AI technology due to national security concerns, according to The Washington Post.

Chinese President Xi Jinping reportedly responded positively to the decision, Trump announced on Truth Social. However, the move has drawn swift criticism from some U.S. lawmakers, with Democrats in Congress calling it a "colossal economic and national security failure" that could inadvertently bolster China's military capabilities, CNA reported.

Nvidia, for its part, welcomed the President's decision, with a spokesperson telling AFP that it allows the American chip industry to compete and supports high-paying jobs. The company emphasized that offering H200 chips to vetted commercial customers strikes a thoughtful balance beneficial to the U.S., as noted by CNA.

• The H200 AI chip, launched in November 2024, is a professional graphics card built on the 5nm process and based on the GH100 graphics processor, according to techpowerup GPU Database. It features 141GB of HBM3e memory and a 4.8 TB/s bandwidth, making it significantly more powerful than its predecessor, the H100, especially for memory-bound AI workloads like large language models, Uvation detailed.

• Previous restrictions under the Biden administration, particularly in October 2022 and updated in December 2024, aimed to choke off China's access to advanced AI chips and semiconductor manufacturing equipment. These controls targeted chips like Nvidia's A100 and H100, citing concerns over their potential dual-use for military applications and to prevent China from gaining an AI industry edge, as explained by CSIS.

• The "25% cut" of proceeds to the U.S. government is an increase from a previous 15% revenue-sharing agreement for the less powerful H20 and AMD's MI308 chips, which was brokered in August 2025. This unusual arrangement, confirmed by CBS News, transforms export restrictions into a revenue-generating mechanism, raising questions about the intersection of national security and economic interests, nasdaq reported.

• Nvidia CEO Jensen Huang has been a vocal proponent of easing export controls, arguing that strict bans risk pushing China to develop its own homegrown AI chip industry, ultimately harming U.S. companies. Huang's lobbying efforts, including recent meetings with President Trump, are widely seen as instrumental in this policy reversal, according to Macao News.

• Despite the approval, uncertainty remains regarding China's willingness to fully embrace the H200 chips. Beijing previously discouraged Chinese companies from purchasing Nvidia's less powerful H20 chips, citing alleged "backdoor security risks" and pushing for domestic alternatives, as noted by TipRanks and a report from Wit Capital. This raises questions about the actual financial impact of the deal if China continues to prioritize self-sufficiency, according to a report by Wit Capital.

• The decision has sparked a strong backlash from some U.S. lawmakers, particularly Democrats. Senator Elizabeth Warren, a Democrat, criticized the deal, suggesting it could "turbocharge China's military and undercut American technological leadership," according to CNA. She and other senior Democrats have labeled the decision a "colossal economic and national security failure," as reported by The Guardian.

• This policy shift signals a potential recalibration in the ongoing U.S.-China tech war, moving from outright bans to a more nuanced approach that seeks to balance national security with economic benefits. However, critics argue that monetizing access to advanced technology for a geopolitical rival sets a dangerous precedent and could undermine long-term strategic goals, as discussed by Trend Depth.

• The Department of Commerce's role in finalizing the details will be crucial in defining the scope of "approved customers" and the mechanisms for the 25% revenue share. The implementation of similar agreements for other chipmakers like AMD and Intel will further shape the landscape of U.S. advanced technology exports to China, as stated by Xinhua.