Cuban praises Trump's China chip policy impacting Nvidia, AMD
In an unprecedented move reshaping the landscape of U.S.-China technology relations, the U.S. government has struck an extraordinary deal with semiconductor giants Nvidia and Advanced Micro Devices (AMD), requiring them to pay 15% of their revenues from certain artificial intelligence (AI) chip sales to China. The agreement, confirmed by President Donald Trump, has drawn both praise from unexpected corners, notably from billionaire investor Mark Cuban, and sharp criticism over its implications for national security and constitutional precedent.
Under the terms of this highly unusual arrangement, Nvidia and AMD will remit a 15% share of the revenue generated from their H20 and MI308 AI chips, respectively, sold in the Chinese market. This payment serves as a condition for obtaining export licenses, reversing a prior ban imposed by the Trump administration in April 2025 that had extended Biden-era export controls on these chips. The H20 chip, specifically designed by Nvidia for the Chinese market to comply with earlier restrictions, and AMD’s MI308 chips, also geared for AI applications, were previously swept up in a broader effort to limit Beijing’s access to advanced semiconductor technology.
President Trump himself confirmed the details, revealing that he personally negotiated the 15% figure with Nvidia CEO Jensen Huang. Trump stated he had initially sought a 20% share, but a “little deal” was struck. He characterized the H20 as an “obsolete” chip, suggesting its sale would not significantly advance China’s capabilities. The administration had announced in July that sales could resume, with the revenue-sharing condition finalized after a White House meeting between Trump and Huang last week.
The deal has found an unlikely champion in Mark Cuban, the outspoken entrepreneur and investor. Cuban lauded Trump’s handling of the situation on social media, describing it as a “billionaire’s tax” or a “sales tax” on two of the country’s largest semiconductor companies. Despite his historical critiques of Trump’s tariff policies, Cuban credited the President for devising a method to generate significant corporate tax revenue, something he argued Democrats have long sought but failed to achieve. He suggested calling it a “Commission for America,” highlighting his belief that it demonstrates Trump’s shrewd understanding of corporate executives’ motivations.
However, the arrangement has ignited a firestorm of debate among legal experts and lawmakers from both sides of the aisle. Critics contend that this revenue-sharing model is unprecedented for export licenses and raises serious questions about its constitutionality. Concerns have been voiced that it amounts to an unconstitutional export tax and could set a dangerous precedent, transforming export controls from a vital national security tool into a revenue-generating mechanism or a “pay-to-play” licensing system. Lawmakers, including the Republican chair and ranking Democrat of the House Select Committee on China, have called for transparency and questioned the legal basis of the agreement, warning against undermining genuine security considerations with “creative taxation schemes.”
Nvidia, for its part, has maintained a stance of compliance, stating, “We follow rules the U.S. government sets for our participation in worldwide markets.” The company expressed hope that these export control rules would enable America to “compete in China and worldwide,” emphasizing the critical need for the U.S. to lead in AI technology and avoid a repeat of the “5G” scenario where it lagged behind. AMD has yet to offer a public comment on the specific details of the agreement.
This policy shift comes amid a years-long effort by the U.S. government to restrict China’s access to cutting-edge technology, particularly chips that could bolster its military and AI development capabilities. While the agreement signals a potential easing of trade tensions, it also prompts questions about the long-term strategy and effectiveness of such controls. President Trump has also hinted at the possibility of future negotiations regarding even more advanced Nvidia chips, such as a “downgraded” version of their Blackwell chip, suggesting this unique approach to tech trade policy may continue to evolve.
The decision to allow Nvidia and AMD to resume chip sales to China in exchange for a slice of their revenue marks a significant and contentious pivot in U.S. technology and trade policy, inviting scrutiny over its legality, economic implications, and impact on the global tech rivalry.