Nvidia AMD China Chip Deal Grants U.S. 15% Revenue Share to Avoid Tariffs

Several U.S. corporate leaders have expressed approval of the recent agreement between Nvidia and AMD to give the U.S. government a 15% share of AI chip sales to China, calling it a strategic move to circumvent tariffs while maintaining access to the Chinese market [1]. Corey duBrowa, global CEO of Burson, noted that the arrangement reflects the Trump administration’s ongoing efforts to redefine trade norms [1]. Another industry veteran described the deal as a testament to the administration’s focus on protecting American manufacturing interests, with the cost seen as justified for the benefits it provides [1]. One CEO went as far as to label the agreement “brilliant, a tariff that we don’t have to pay” [1].

While many CEOs were optimistic, others raised concerns about the implications. Questions about national security arose, with some leaders noting that the deal blurs the line between trade incentives and security restrictions. Typically, trade policies are designed to safeguard national interests, not to generate revenue. Some warned that financial incentives could potentially undermine security priorities [1]. Others questioned the impact on global trade relations, suggesting that such arrangements could erode trust among international partners, especially as more nations erect trade barriers and form economic blocs [1].

The agreement is expected to generate additional revenue for the U.S. Treasury, potentially adding $4 billion to federal coffers in the coming year [1]. This comes as tariffs—already projected to generate $50 billion monthly—remain a contentious policy tool. Moody’s Chief Economist Mark Zandi has warned that tariffs are likely to face political pressure to be reduced during economic downturns and are therefore not a stable long-term funding source [1]. The revenue generated from the Nvidia and AMD deal may be used in a variety of ways, including debt reduction, consumer relief, or other federal priorities, though specifics have yet to be outlined [1].

The broader trade context includes a U.S.-China agreement to pause higher tariffs and settle for a 10% rate while negotiations continue. The pause follows a prior agreement that had lowered tariffs from a peak of 145% to 30% [1]. Nvidia CEO Jensen Huang had reportedly spent months working behind the scenes to secure the current deal, which also included a $500 billion U.S. investment commitment and assurances of continued access to less powerful chips for China [1]. The final approval, however, came only after President Trump added a financial demand to the negotiations [1].

In related news, Intel CEO Lip-Bu Tan had a reportedly positive meeting with Trump following earlier tensions. Trump initially demanded Tan’s resignation due to his Chinese business ties but later praised the executive’s success during their meeting [1]. The company has since committed to working with the White House to “restore this great American company” [1].

Stifel analysts have raised concerns about the U.S. economy’s vulnerability to stagflation, citing a slowdown in consumer spending and the waning impact of pandemic-era stimulus. They predict a potential selloff of 10% or more in the S&P 500 [1]. Meanwhile, the markets have shown mixed performance, with the S&P 500 futures flat in early trading and major European and Asian indices showing modest gains [1].

Sources:

[1] [What CEOs really think about Nvidia and AMD’s China export deal: ‘Brilliant, a tariff that we don’t have to pay’](https://fortune.com/2025/08/12/ceos-nvidia-and-amd-china-export-deal/)