Trump said Monday that he has cut a deal with chipmaker Nvidia, allowing it to sell certain artificial intelligence chips to China in exchange for a cut of the revenue, which would go to the U.S. government. Trump said he also negotiated a similar deal with chipmaker Advanced Micro Devices (AMD).

The arrangement crafted by the Trump administration is “unusual,” analysts told CNBC, but underscores the president's transactional nature.

Just because it's already the biggest company in the world by market cap doesn't mean the GPU leader doesn't have a lot of room to grow.

China is an important market for Nvidia, generating $17.1 billion in fiscal 2025 revenue, or 13.1% of total revenue. However, Nvidia and AMD ( AMD) recently agreed to pay the U.S. government 15% of Chinese revenue as part of a deal to secure export licenses to China.

Is the good news fully priced in? Explore key insights on demand, stockpiling, and margins. Read why NVDA is a Hold.

In a surprising reversal of the United States’ years-long technology restrictions on China, President Donald Trump last month allowed Nvidia to resume sales of a key AI chip designed specifically for the Chinese market.

Nvidia can sell its AI chips in China, and hyperscalers are spending more heavily on data center infrastructure than Wall Street anticipated.

The US government will use its 15% sales tax on NVIDIA and AMD chips sold to China to pay down US debt, in a new strategic move from the Trump admin.