President Donald Trump signed an order placing a 25% tariff on selected advanced AI semiconductors. The move covers NVIDIA’s H200 chips and AMD’s MI325X processors.

The tariff applies to chips made outside the US that pass through the country before being shipped to foreign buyers. Chips imported for use inside the US are not affected.

The decision follows a recent Commerce Department move that allowed NVIDIA to export H200 chips to approved buyers in China. The new tariff allows sales to continue but ensures the US government earns revenue from them.

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NVIDIA welcomed the decision. A company spokesperson said, “We applaud President Trump’s decision to allow America’s chip industry to compete,” adding that the policy supports high-paying US jobs and keeps exports limited to approved customers.

Demand for advanced AI chips remains strong. Reports suggest NVIDIA may boost production to meet early orders from Chinese firms, though Chinese regulations could slow purchases.

China is drafting new rules to cap foreign chip imports. The goal is to meet short-term tech needs while strengthening its own semiconductor industry.

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The proclamation highlights national security concerns. It notes that the US currently makes only about 10% of the chips it needs, calling reliance on foreign supply chains a serious risk.

The order clearly exempts chips brought into the US for research, defense, or commercial use, focusing only on exports routed through the country.