Shares of Nvidia (NVDA) and AMD (AMD) fell on Monday after the two companies agreed to pay the US government 15% of the revenue for certain chip sales to China.
Nvidia stock was off by 0.4% premarket, while AMD stock dropped 1.4% as investors digested the unusual deal in which the chipmakers will essentially pay for export licenses.
While the details are still being worked out, the chips in question reportedly include Nvidia’s H20 AI chip and AMD’s MI308 chips, which previously faced export controls from the Trump administration.
Nvidia CEO Jensen Huang made the deal at the White House last Wednesday, the same day Apple (AAPL) agreed to increase its US investment to $600 billion, ostensibly to help the company avoid tariffs, as the Trump administration looks to monetize trade policy.
An Nvidia spokesperson told Yahoo Finance: “We follow rules the U.S. government sets for our participation in worldwide markets. While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide. America cannot repeat 5G and lose telecommunication leadership. America’s AI tech stack can be the world’s standard if we race.”
As for other chip stocks, Intel (INTC) and Qualcomm (QCOM) shares rose, while Taiwan Semiconductor (TSM) fell modestly.
