- The US government is demanding a 15% revenue share from Nvidia and AMD for export licences to sell certain GPUs to China.
- This move marks an unprecedented commercial condition in US tech export policy, shifting from security-based to profit-based restrictions.
What happened: US demands revenue cut from Nvidia, AMD exports to China
The US government has reportedly demanded a 15 per cent revenue share from Nvidia and AMD in exchange for granting export licences for even sub-standard GPUs destined for China. According to Financial Times, this quid-pro-quo represents an unprecedented move—no US company has previously had to surrender part of its revenue just to gain approval to export products.
This policy appears to aim at bolstering US revenue rather than restricting technology based on security concerns. It follows a pattern in the current administration’s approach that uses geopolitical considerations as a lever for shifting profits back to the state.
Also Read: NVIDIA rolls out new Omniverse tools for robotics
Also Read: India’s first NVIDIA DGX-Ready Data Centre opens in Chennai
Why it’s important
This development marks a sharp departure from normal trade practice and adds a new layer of commercial risk for tech companies. Typically, export controls aim to block or delay, not profit from, sensitive transactions. In this case, selling GPUs—a key component in AI and data processing—into China requires companies to pay up or walk away.
This could severely impact tech strategies across the sector. GPU makers like Nvidia and AMD must weigh the cost of compliance against potential revenues and may need to rethink the profitability of serving major markets like China. This tension also disrupts supply chains, potentially slowing global access to AI hardware.
