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WIRED
2 days ago
- Business
- WIRED
Why Trump Flip-Flopped on Nvidia Selling H20 Chips to China
Aug 14, 2025 3:56 PM Nvidia struck a surprising deal after convincing the president that H20 chips aren't a national security risk. But whether the reversal is good or bad depends on who you ask. Nvidia CEO Jensen Huang acknowledges being recognized by US President Donald Trump as he delivers remarks at the "Winning the AI Race" AI Summit at the Andrew W. Mellon Auditorium in Washington, DC, on July 23, 2025. Photograph: ANDREW CABALLERO-REYNOLDS/Getty Images The tech industry is reeling from President Trump's surprising new deal with Nvidia. Earlier this week, Trump said he would allow the company to continue selling its H20 chips to China in exchange for a 15 percent share of the revenues. 'The H20 is obsolete. You know, it's one of those things, but it still has a market,' Trump said at a press conference on Monday. 'So we negotiated a little deal.' The unusual and legally dubious arrangement is a striking reversal for the Trump administration, which banned all H20 sales to China earlier this year. The president reportedly changed his mind about the issue after meeting with Nvidia CEO Jensen Huang, who has argued that allowing Chinese companies to buy H20s doesn't pose a risk to US national security. On one hand, this is a simple story about a president who appears to have been influenced by a powerful executive lobbying in his company's interest. But beneath the surface, there's a much more interesting and complicated saga about how we got here. Nvidia introduced the H20 last year after the US government banned the company from selling a more powerful chip, the H800, to China. The move was part of an ambitious project orchestrated by Biden administration officials who believed the United States needed to prevent China from developing advanced artificial intelligence first. For the past few months, I've been working closely with Graham Webster, a researcher at Stanford University who sought to understand how and why the Biden team decided the US needed to curb China's access to advanced semiconductors in the first place. Today, WIRED is publishing Graham's definitive account of what really happened behind the scenes, based on interviews with more than 10 former US officials and policy experts, some of whom spoke on the condition of anonymity. 'I did this piece because the official legal justification for the controls, military and human rights, was obviously never the whole story,' Graham told me. 'Clearly AI was in the mix, and I wanted to understand why in some depth.' Graham writes that several key officials in Biden's White House and Commerce Department 'believed AI was approaching an inflection point—or several—that could give a nation major military and economic advantages. Some believed a self-improving system or so-called artificial general intelligence could be just over the technical horizon. The risk that China could reach these thresholds first was too great to ignore.' So the Biden team decided to take action. In the fall of 2022, they unveiled broad export controls aimed at preventing China from accessing the most advanced chips required for training powerful AI systems, as well as specialized equipment Beijing needed to modernize its own domestic chipmaking industry. The move was the start of a multi-year project that 'would reshape relations between the world's two largest powers and alter the course of what may be one of the most consequential technologies in generations,' Graham writes. What struck me about Graham's story is just how many people involved in Biden's export control policies moved on to other influential positions in the world of AI, computing, and national security. Jason Matheny, who led the White House's policy on technology and national security, is now the president and CEO of RAND, a prominent think tank that often serves government clients. Tarun Chhabra, who worked on the National Security Council, now leads national security policy at Anthropic. Following these career paths helps contextualize different broad viewpoints in today's debate over Nvidia's H20 chips. In January, Anthropic CEO Dario Amodei published a blog post in which he argued that companies should be banned from selling H20s to China. 'Well-enforced export controls are the only thing that can prevent China from getting millions of chips,' and are therefore 'the most important determinant' of whether the US and its allies will take a leading role on the world stage in the future, Amodei wrote. In one section of the post, he linked to semiconductor research published by RAND. Top officials from Trump's first administration, such as former deputy national security adviser Matt Pottinger, have articulated views similar to Amodei's. On the other side of the debate are people like David Sacks, Trump's AI and crypto czar, who has argued that 'overly restrictive' export controls will allow Chinese companies to gain more market share around the world. For now, Sacks' argument appears to have won out. But it's still unclear which of these viewpoints will prove the most convincing to Trump in the long run. This is an edition of Zeyi Yang and Louise Matsakis' Made in China newsletter . Read previous newsletters here.
The National
4 days ago
- Business
- The National
Trump says Nvidia's H20 is 'obsolete', yet there are worries about selling the GPU to China
US President Donald Trump explained his decision to allow Nvidia to sell its H20 graphics processing unit (GPU) to China on Monday by describing it as obsolete. More specifically, Mr Trump was asked about making a deal with Nvidia for the US government to receive a 15 per cent cut of sales to Beijing. 'I deal with Jensen [Huang], who is a great guy,' Mr Trump said, referring to Nvidia's chief executive and founder. 'The chip that we're talking about, the H20, it's an old chip and China already has it … but it's obsolete and it still has a market.' That begs the question, however, why there is so much demand from China for the H20, and why some elected officials and analysts are so concerned that Mr Trump will allow the chip to be sold to the country. By most standards, Mr Trump's description of the H20 as obsolete is incorrect – to describe a technology, particularly a piece of hardware like the H20 GPU, as obsolete is to imply that it's no longer supported by the tech world, making it completely impractical to use within an existing technology ecosystem. That's not the case with the H20, which was designed several years ago by Nvidia to comply with US regulations seeking to prevent powerful AI technologies from being used by countries it views as adversaries. In recent weeks, a group of Democratic senators sent a letter to White House officials criticising the move to allow the resumption of H20 sales to China, claiming that because of the GPU's improved power-efficiency and high-bandwidth memory chips, 'many PRC [People's Republic of China] firms reportedly prefer the H20 to other controlled chips'. That's hardly an indication a GPU design is obsolete. Late in July, in response to The National's inquires about concerns about the H20 being sold in China, Nvidia did not exactly describe the GPU as obsolete either. 'The H20 helps America win the support of developers worldwide, promoting America's economic and national security,' the statement read, emphasising the chip's deliberately modest attributes. 'It does not enhance anyone's military capabilities, and the US government has full visibility and authority over every H20 transactions.' Some Republicans have also described Nvidia's H20 as still relevant. Representative John Moolenaar, who chairs the House Select Committee on the Chinese Communist Party, recently opposed resuming exports of the H20 to China. 'The H20 is a stark improvement over what the Chinese can indigenously produce at scale,' he said during a speech at Purdue University's Krach Institute for Tech Diplomacy. 'When, not if, these chips are diverted to [China's] People's Liberation Army supercomputer, they will substantially upgrade their ability to run advanced AI models.' H20 paranoia abounds Regardless of whether or not one considers the H20 to be obsolete, there is a tremendous amount of speculation surrounding the chip, with some of the paranoia coming from China, where there is demand for it. This month, Nvidia sought to debunk reports that claimed some of its chips had a backdoor kill switch, to blunt any misuse that might compromise national security. Some members of the US Congress have even sought to make it mandatory for certain chips to contain kill switches. 'Nvidia GPUs do not and should not have kill switches and backdoors,' a blog post from the company read. 'No kill switches, and no spyware … that's not how trustworthy systems are built – and never will be.' Despite those assurances, however, recent reports have indicated China still has concerns. According to Bloomberg, Chinese officials are telling various companies within the country to not use Nvidia's H20 over fears that the chips might be compromised and vulnerable to being exploited. The Chinese embassy in Washington has not yet responded to The National's requests for comment. Trump praises Nvidia's Blackwell architecture Despite ample conjecture about the H20 coupled with the varying opinions about Nvidia's sales of it to China, during Mr Trump's news conference on Monday, he made clear that the company's other GPU offerings would likely not be exported to China anytime soon, at least not without a few changes. Mr Trump said Nvidia's highly touted Blackwell GPUs would need to be toned down before he would consider allowing them to be sold in China. 'It's super-duper advanced and I wouldn't make a deal with that,' he said, before quickly giving himself some wiggle room. 'Although it's possible that I would make a deal if they enhanced it in a negative way.' Mr Trump said based on his conversations with Mr Huang, he's impressed with the Blackwell platform, adding that in terms of processing power, none of Nvidia's competitors have it, 'and they probably won't for five years'. As for the 15 per cent cut that the Trump White House wants for the H20 sales to China, on Tuesday, press secretary Karoline Leavitt said similar approaches might be applied to other companies and products, although she said specifics were still being worked out by the Department of Commerce. Some have questioned the constitutionality of the move, referring to it as a "reverse tariff".
Bloomberg
18-07-2025
- Entertainment
- Bloomberg
Rock Star CEO Jensen Huang Shows Off Diplomatic Skills in China
Hi, this is Allen Wan in Beijing, where I spent most of the week chasing Nvidia CEO Jensen Huang. One thing I've learned is he's more than just a chip executive. He's a rock star cum pretty skillful diplomat. Read more about Huang, the reluctant emissary, here.
Washington Post
21-05-2025
- Business
- Washington Post
Trump drafts America's business titans to burnish his image at home and abroad
WASHINGTON — President Donald Trump isn't the only one who wrapped up a Middle East tour in recent days. A private jet carrying Nvidia's CEO trailed Air Force One across the region. Oil executives and bankers followed, too, as American executives dropped everything — canceling longstanding obligations and zooming into board meetings back home — to cozy up to Trump and bolster the image he tried to sell on his first major foreign trip.
Arab News
16-05-2025
- Business
- Arab News
UAE to build biggest AI campus outside US in Trump deal, bypassing past China worries
DUBAI: The United Arab Emirates and the United States have signed an agreement for the Gulf country to build the largest artificial intelligence campus outside the United States, a type of deal that previously faced restrictions over Washington's concerns that China could access the technology. The countries did not say which AI chips from Nvidia or other companies could be included in UAE data centers, but sources had said a deal would give the Gulf country expanded access to advanced AI chips. Nvidia Chief Executive Jensen Huang was seen in televised footage conversing with US President Donald Trump and UAE President Sheikh Mohamed bin Zayed Al Nahyan at a palace in Abu Dhabi on Thursday. Such a long-coveted deal, finalized during Trump's visit to Abu Dhabi on Thursday, is a major win for the UAE, which has been trying to balance its relations with its longtime ally the US and its largest trading partner China. It reflects the Trump administration's confidence that the chips can be managed securely, in part by requiring data centers be managed by US companies. The UAE, a major oil producer, has been spending billions of dollars in a push to become a global AI player. But its ties to China had limited access to US chips under former President Joe Biden. The AI agreement 'includes the UAE committing to invest in, build, or finance US data centers that are at least as large and as powerful as those in the UAE,' the White House said. 'The agreement also contains historic commitments by the UAE to further align their national security regulations with the United States, including strong protections to prevent the diversion of US-origin technology.' Reuters had earlier reported that the two countries had finalized a technology framework agreement and that it would require commitments on both sides to the security of the technology. The UAE could be allowed to import 500,000 of Nvidia's most advanced AI chips per year starting in 2025, sources have told Reuters. Nvidia declined to comment. The UAE foreign ministry did not immediately respond to a request for comment. Central to the agreement announced on Thursday is the 10 square mile (25.9 square kilometer) AI campus in Abu Dhabi with 5 gigawatts of power capacity for AI data centers, the US Commerce Department said. 'That's bigger than all other major AI infrastructure announcements we've seen so far,' Rand Corporation analyst Lennart Heim said on X. That is enough power to support 2.5 million of Nvidia's top-line B200 chips, he calculated. The campus will be built by Abu Dhabi state-backed firm G42, but US Secretary of Commerce Howard Lutnick said in a release that 'American companies will operate the data centers and offer American-managed cloud services throughout the region.' The US fact sheets also described chip company Qualcomm working on an AI-related engineering center and that Amazon Web Services, the cloud unit of the tech and commerce company, would work with local partners on cybersecurity and fostering cloud adoption. Easing relations The US has pursued protectionist policies for years to curb China's access to advanced semiconductors, including ensuring the chips do not end up in the country via third parties. Regulations are easing under Trump, whose AI czar David Sacks said in Riyadh on Tuesday that the Biden administration's export controls were 'never intended to capture friends, allies, strategic partners.' Granting the UAE more access to the most advanced chips, manufactured by firms such as Nvidia, marks a major turnaround. 'This shift enables (the UAE) to deepen its technology partnership with the US while still preserving trade ties with China,' said Mohammed Soliman, senior fellow at the Middle East Institute. 'It doesn't mean abandoning China but it does mean recalibrating tech strategy to align with US standards and protocols where it matters most: compute, cloud, and chip supply chains,' he said. AI was top of the agenda when UAE President Sheikh Mohamed bin Zayed Al Nahyan visited Washington in December in the final days of Joe Biden's presidency. G42 and MGX, the state-linked vehicles picked to drive the UAE's AI investment push, have also invested in US firms such as OpenAI and Elon Musk's xAI, while Microsoft last year agreed to invest $1.5 billion in G42. The two companies said the deal was backed by security assurances, and under US pressure, G42 had previously begun ripping out Chinese hardware it was using and sold off Chinese investments. Still, major Chinese firms like Huawei and Alibaba Cloud are present in the UAE, and organized AI chip smuggling to China was tracked out of countries including Malaysia, Singapore and the UAE, a source told Reuters in February.
