Trump allows Nvidia H200 sales to China with 25% U.S. cut; Beijing signals limits, market reaction muted
President Trump said he will allow Nvidia to sell its H200 AI chips to China with the U.S. taking a 25% cut of sales, saying he informed Xi Jinping and received a positive response, and that the "same approach" would apply to AMD and Intel while the Commerce Department finalizes details — a move Nvidia called a "thoughtful balance." Beijing signaled it may still limit access by requiring buyers to justify why domestic chips are insufficient, and the market reaction was muted (Nvidia shares dipped about 0.3%) as analysts and executives remain cautious about actual China orders, with prior black‑market diversions of banned Nvidia chips underscoring ongoing enforcement challenges; H200s are powerful but still a generation behind Nvidia’s newest Blackwell chips.
📌 Key Facts
- President Trump announced the U.S. will take a 25% cut of Nvidia H200 sales to China and said he informed Xi Jinping, who gave a positive response.
- Trump said the same approach would apply to AMD and Intel, with the Commerce Department to finalize implementation details.
- A Nvidia spokesperson called the decision a "thoughtful balance," and the company is noted as having an approximately $4.5 trillion market capitalization.
- Chinese regulators are poised to limit access to H200s, likely requiring buyers to justify why domestic chips are insufficient (per FT reporting).
- Market reaction was muted: Nvidia shares closed down about 0.3% after the announcement; William Blair analyst Sebastien Naji said he won't raise long-term estimates absent actual China orders, and CEO Jensen Huang said he is unsure whether China will accept H200s.
- U.S. prosecutors disrupted a China-linked network that trafficked more than $160 million in restricted Nvidia chips, including H200s, and the FT previously reported over $1 billion of banned Nvidia chips entered China via the black market during prior export restrictions.
- The H200 is substantially more capable than the H20 but remains a generation behind Nvidia’s newest Blackwell chips, which are still excluded from exports.
📊 Relevant Data
By 2025, Chinese universities are projected to produce more than 77,000 STEM PhD graduates per year compared to approximately 37,000 in the United States. China's population is about 1.4 billion (approximately 18% of world population), while the US population is about 330 million (approximately 4% of world population). Per capita, the US produces roughly twice as many STEM PhDs as China.
China is Fast Outpacing U.S. STEM PhD Growth — CSET Georgetown
U.S. export controls on advanced Nvidia AI chips have incentivized China's industry to develop alternatives, while also making it more difficult for China to access advanced technology.
China's racing to beat U.S. chip curbs. How its supply chain stacks up — CNBC
The annual cost of intellectual property theft by China to the U.S. economy is estimated to be between $300 billion and $600 billion.
CCP Threat UPDATED Feb 2025 — U.S. House Committee on Homeland Security
In 2023, there were approximately 2,000 active investigations into apparent state-sponsored theft by China in the United States, covering a diverse array of U.S. technologies.
2024 Report to Congress on China's WTO Compliance — Office of the United States Trade Representative
Asian professionals hold about 34% of tech roles in the U.S., compared to their 6.9% share of the overall U.S. labor force in 2023.
Diversity in Tech Statistics 2025: Who's Still Left Out? — SQ Magazine
📰 Sources (3)
- Chinese regulators are poised to limit access to H200s, requiring buyers to justify why domestic chips are insufficient (FT report cited).
- Nvidia shares closed down 0.3% after the announcement; William Blair analyst Sebastien Naji says he won't raise long-term estimates absent actual China orders.
- CEO Jensen Huang has said he is unsure whether China will accept H200s.
- Axios notes U.S. prosecutors disrupted a China-linked network trafficking more than $160 million in restricted Nvidia chips, including H200s, underscoring ongoing black-market flows.
- FT previously reported over $1 billion of banned Nvidia chips entered China via the black market during export restrictions.
- H200s, while far more capable than the H20, are still a generation behind Nvidia’s newest Blackwell chips, which remain excluded.
- Trump says the U.S. will take a 25% cut of Nvidia H200 sales to China.
- Trump says he informed Xi Jinping of the decision and received a positive response.
- He indicated the 'same approach' will apply to AMD and Intel, with Commerce finalizing details.
- Nvidia spokesperson endorsed the decision as a 'thoughtful balance' and the article notes Nvidia’s ~$4.5T market cap.
- Context: Article recalls an August plan contemplating export licenses tied to a 15% U.S. revenue cut and a proposed 10% U.S. stake in Intel alongside grants.