Trump considered breaking up Nvidia due to concerns about competition in AI chips, but was told it would be "hard" to do so.

President Donald Trump considered breaking up Nvidia to increase competition in AI chips but was told it would be difficult. Trump praised Nvidia CEO Jensen Huang for his investments in the US and unveiled his AI Action Plan to aid the industry. Nvidia has profited from the demand for AI hardware and was previously investigated by the Justice Department for possible anticompetitive behavior.

The recent decision to resume sales of Nvidia's H20 chips to China has ignited a debate over U.S. strategy in the AI market. Representative John Moolenaar, a Republican, expressed concerns that the move could enhance China's AI capabilities and undermine U.S. innovation. Moolenaar's letter to U.S. Commerce Secretary Howard Lutnick emphasized the potential risks, stating that the chips could be used to train AI models that power China's military and censorship apparatus [1].

Nvidia's announcement, which reversed an export restriction imposed by the Trump administration, has drawn swift criticism from U.S. legislators. The company's spokesperson defended the decision, asserting that it promotes U.S. technology leadership and economic growth. However, Moolenaar's letter underscores the national security concerns surrounding the export of advanced AI chips to China [1].

The decision comes as part of ongoing negotiations between the U.S. and China over rare earths and magnets. The U.S. still requires approval for the export of H20 chips, but Nvidia expects licenses to be granted soon. Moolenaar requested a briefing on the Department of Commerce's evaluation process, the estimated number of H20 chips to be exported, and to whom [1].

Meanwhile, President Donald Trump has been considering breaking up Nvidia to increase competition in the AI chip market. However, he was advised that such a move would be difficult to execute. Instead, Trump praised Nvidia CEO Jensen Huang for his investments in the U.S. and unveiled his AI Action Plan to aid the industry [3]. Nvidia has profited from the demand for AI hardware and was previously investigated by the Justice Department for possible anticompetitive behavior [3].

The debate over Nvidia's H20 chip exports highlights the complex interplay between economic interests and national security concerns in the AI market. As the U.S. seeks to maintain its technological edge, the decision to resume chip sales to China will continue to be a contentious issue.

References:
[1] https://www.yahoo.com/news/top-republican-china-panel-objects-143337649.html
[2] https://www.abc.net.au/news/2025-07-23/donald-trump-united-states-trade-deal-japan-shigeru-ishiba/105562448
[3] https://www.networkworld.com/article/3562856/nvidia-latest-news-and-insights.html