Nvidia shares dip on report of 15% revenue share to US government; Tesla shares rise on autonomous driving focus

Nvidia shares dipped due to reports of an unprecedented 15% revenue share to the US government for export licenses. Tesla shares rose after CEO Elon Musk announced the company will focus on autonomous driving systems and disband the Dojo supercomputer team. Musk confirmed Tesla's AI5 and AI6 chips will assume the role previously held by the Dojo team.

Title: Nvidia and Tesla Navigate Major Shifts in AI Chip Market

NVIDIA shares dipped on July 2, 2025, following reports of an unprecedented 15% revenue share to the U.S. government for export licenses of AI chips sold to China. Meanwhile, Tesla shares rose as CEO Elon Musk announced a shift in focus towards autonomous driving systems and the disbanding of the Dojo supercomputer team. Musk confirmed that the company's AI5 and AI6 chips will assume the role previously held by the Dojo team [2].

NVIDIA and AMD have reportedly agreed to share 15% of revenue from sales of AI chips to China with the U.S. government. This arrangement covers chips such as NVIDIA’s H20, which is designed for artificial intelligence applications. The agreement was reportedly discussed following a meeting between NVIDIA CEO Jensen Huang and President Trump two days prior to an announcement that the Commerce Department would begin to issue H20 export licenses [1].

The decision by Tesla to terminate its Dojo project and shift focus to AI5 and AI6 chips produced by Samsung marks a significant pivot in the company's strategy. The Dojo project, which aimed to develop superior AI accelerator chips in-house, faced numerous delays and setbacks. Peter Bannon, the project's head, and several key figures have left Tesla to join DensityAI, a stealth-mode startup. Tesla plans to utilize NVIDIA and AMD for computing power, while Samsung Electronics will handle chip manufacturing [2].

The move by Tesla underscores the evolving landscape of AI technology and chip manufacturing partnerships. Musk has expressed optimism about the capabilities of AI5 and AI6 chips, emphasizing their potential for inference and training. The collaboration with Samsung marks a pivotal shift in Tesla’s strategy, leveraging external expertise to achieve its ambitious AI goals [2].

China remains a key market for both NVIDIA and AMD. If sales return to previous levels, the U.S. government could collect hundreds of millions per quarter under the 15% arrangement, according to analysts. NVIDIA earned approximately $17 billion in revenue from China in its last fiscal year, accounting for 13% of total sales. AMD reported $6.2 billion in Chinese revenue in 2024, or 24% of its total [1].

The financial implications of these shifts are significant. NVIDIA’s revenue-sharing agreement with the U.S. government could have a substantial impact on its financial performance. Meanwhile, Tesla’s decision to focus on AI5 and AI6 chips produced by Samsung could lead to increased efficiency and cost savings in the long run. The question remains whether these strategic shifts will enhance Tesla’s competitive position in the autonomous driving and robotics industries.

References:
[1] https://www.foxbusiness.com/technology/nvidia-amd-strike-major-revenue-sharing-deal-us-government-over-china-chip-sales
[2] https://www.bloomberg.com/news/articles/2025-08-07/tesla-disbands-dojo-supercomputer-team-in-blow-to-ai-effort