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US President Donald Trump has announced that he will approve the sale of NVIDIA’s H200 AI chips to China. The decision would be a key U-turn in the ongoing tech and geopolitical tug-of-war. Trump had previously rolled back restrictions on NVIDIA’s degraded H200 chips, specifically made to meet export limits, but China refused to import the reduced capacity model.
The US President wrote in a Truth Social post that Chinese President Xi Jinping responded ‘positively’ to the decision. He also disclosed that NVIDIA will pay the US 25% of chip sale revenue, up from the previously negotiated 15%, as part of the deal.
NVIDIA’s stock, which was already rising based on earlier reports of the approval, jumped nearly 2% in premarket trade on Tuesday. CEO Jensen Huang has long made the case that allowing chip sales to China strengthens the US hand in the global AI race. He argues that selling US hardware ensures Chinese developers remain reliant on US-built technology rather than transitioning to domestic alternatives.
Since the Biden administration placed export limits, China has boosted the pace of domestic AI chip development. Huang insists that the US needs to remain influential in a market with nearly half of the world’s AI programmers.
Also Read: NVIDIA Crowdsources Specs for Next-Gen RTX 5060 Gaming PC Build
Security hawks and several US lawmakers have argued that advanced chip sales, even those one generation behind the cutting-edge NVIDIA Blackwell processors, could fuel China’s military capabilities as well as its rapid improvement in AI.
US Senator Elizabeth Warren sharply criticized the move, suggesting that a donation by NVIDIA to White House East Wing renovation helped the company secure favorable treatment. She warned that the decision would ‘turbocharge China’s bid for technological and military dominance’ and urged Congress to intervene and force Huang to testify under oath.
Multiple tech giants, including Apple, Google, Meta, Amazon, and Microsoft, have also contributed to the East Wing project. As NVIDIA gets ready to launch next-generation Rubin chips in 2026, Trump’s move prompts an important question: Is the US securing strategic leverage or strengthening a rival’s technological rise?
