Big Tech’s Tariff Deals: How Nvidia, AMD, and Apple Are Paying to Avoid Trump’s China Trade War
Major U.S. technology companies are making unprecedented financial commitments to sidestep President Donald Trump’s escalating tariffs on Chinese trade. In the past week, the White House confirmed that chipmakers Nvidia and Advanced Micro Devices (AMD) secured permission to sell advanced semiconductors to China by agreeing to pay the U.S. government 15% of their revenues from those sales. At the same time, Apple CEO Tim Cook announced plans to boost the company’s U.S. investment to $600 billion over the next four years, a move widely interpreted as a strategy to avoid steep import duties.
Industry analysts say these deals underscore how urgent tariff relief has become for Big Tech. “In some shape or form, all of the big tech companies have been negatively impacted by tariffs,” said Paolo Pescatore of PP Foresight, warning that additional fees could further erode profits. Apple, long vulnerable to U.S.-China trade tensions, recently faced $800 million in tariff costs in one quarter alone. Trump’s proposal for a 100% tariff on imported chips — with exemptions for firms manufacturing domestically — makes Apple’s investment strategy a high-stakes gamble that appears to be paying off, at least for now.
The Nvidia and AMD arrangement has sparked controversy, with some critics calling it a “shakedown” and others questioning its constitutionality. White House spokesperson Karoline Leavitt acknowledged that the legal framework for the 15% export levy is “still being ironed out” and hinted similar agreements could target other companies. Industry veteran Ray Wang described the deal as “bizarre,” noting the ambiguity over whether the chips in question pose a national security risk.
While markets initially reacted positively, seeing the agreements as a way to maintain critical access to the Chinese market, investor concerns remain. Analysts caution that the deals could set a precedent for arbitrary government intervention, raising fears about policy instability. “Do you have a policy one week and then it flips the next? That’s what concerns me more,” said Dan Niles of Niles Investment Management.
Looking ahead, these arrangements may signal a new era of transactional policymaking in Washington, where large corporations must offer substantial domestic economic contributions in exchange for trade concessions. As tariff negotiations with China continue, the tech sector will be watching closely to see if these high-profile deals represent one-off exceptions — or the new cost of doing global business under Trump’s second term.
Source: CNBC