Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales to China in exchange for export licenses, an unprecedented quid pro quo arrangement aimed at solidifying America’s AI business dominance while maintaining trade ties with China.

Why Nvidia’s and AMD’s China deal with Trump could backfire. The companies making the most money from the AI boom are the ones selling the processors, such as Nvidia and AMD.

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