Trump Administration Reverses Course on Nvidia Export Ban After High-Dollar Dinner

The U.S. government has reportedly backed away from a plan to block Nvidia’s exports of its H20 HGX GPU to China, following a high-profile meeting between former President Donald Trump and Nvidia CEO Jensen Huang.

The meeting took place during a $1 million-per-head fundraising dinner, sources familiar with the matter said.

AI Chip Designed to Skirt Export Controls

The Nvidia H20 HGX GPU, specifically designed to comply with U.S. export regulations, plays a critical role in powering large-scale artificial intelligence models.

While tailored to remain within the limits of the U.S. export control framework, the chip still delivers enough processing power to be highly sought after by leading Chinese tech firms—including ByteDance, Alibaba, Tencent, and the rapidly expanding AI startup DeepSeek.

Strategic Chip at Center of National Security Debate

The H20 chip has become Nvidia’s most advanced AI processor that can be legally shipped to China under current U.S. rules.

It has been at the center of escalating debate in Washington over national security concerns tied to the global AI arms race.

The Trump administration had been preparing to impose tighter restrictions on H20 exports—a move that could have significantly disrupted Nvidia’s operations in one of its fastest-growing markets.

$16 Billion Chip Orders Reflect Beijing’s Urgency

Chinese companies have placed orders exceeding $16 billion for the H20 GPUs, signaling a surge in demand driven by fears of looming U.S. sanctions.

The chip is essential for running inference tasks on large language models such as OpenAI’s GPT, Meta’s LLaMA, and China’s DeepSeek-V2.

Nvidia Navigates AI Diffusion Rule Restrictions

Nvidia engineered the H20 chip to meet the Total Processing Performance (TPP) limit established under the Biden administration’s AI export control framework, known as the AI Diffusion Rule.

This rule includes a Low Processing Performance (LPP) exemption, which allows a small number of chips that fall under certain thresholds to be exported to countries outside the U.S. and its closest allies—known as Tier 2 nations—without a license.

China Excluded from Exemptions, Faces Export Hurdles

However, China remains excluded from this exemption. All exports of advanced AI processors to China require a U.S. government license, which are typically denied by default, making it extremely difficult for Chinese entities to acquire American AI hardware through legal channels.

Nvidia’s Sales Boom in Limbo Amid Regulatory Uncertainty

For Nvidia, this represents a major dilemma.

The company reportedly sold $16 billion worth of H20 chips to Chinese customers in the first quarter of 2025 alone.

It remains unclear whether the temporary relief from the Trump administration allows Nvidia to continue exports beyond May 15, or only until that date.

Potential Changes Ahead for Export Control Policies

If ongoing exports are to be allowed, the administration may need to revise or override the Biden-era AI Diffusion Rule, or issue special export licenses to Nvidia for sales to major Chinese clients.

Tech, Trade, and Security Interests Collide

As the AI chip race intensifies, this decision underscores the delicate balance between economic interests, national security, and international tech competition.

News Gist

The U.S. has paused plans to block Nvidia’s H20 GPU exports to China after a meeting between Donald Trump and Nvidia CEO Jensen Huang.

The chip, crucial for AI models and tailored to skirt export limits, saw $16B in Chinese orders.

Its future hinges on whether the Trump administration alters Biden-era export rules or grants special licenses.