U.S. President Donald Trump on Wednesday imposed a 25% tariff on certain Artificial Intelligence chips, including the Nvidia H200 Artificial Intelligence processor and a similar semiconductor from AMD called the MI325X, under a new national security order released by the White House. The proclamation follows a nine-month investigation under Section 232 of the Trade Expansion Act of 1962 and targets a number of high-end semiconductors that meet specific performance benchmarks, as well as devices containing those chips, for import duties. The order is part of a broader effort to incentivize chipmakers to produce more semiconductors in the United States and to reduce reliance on manufacturers in locations such as Taiwan.
The White House described the tariffs as narrowly focused and stated that they will not apply to chips and derivative devices imported for U.S. data centers, startups, non-data center consumer applications, non-data center civil industrial applications and U.S. public sector applications. Commerce Secretary Howard Lutnick has wide discretion to apply additional exemptions, and shares of Nvidia, AMD and Qualcomm traded slightly lower in after-hours trading following the announcement. The proclamation stressed that the United States currently fully manufactures only approximately 10 percent of the chips it requires, characterizing this dependence on foreign supply chains as a significant economic and national security risk.
The move builds on Trump’s broader tariff agenda, which previously included September actions with 100% duties on branded drugs and 25% levies on heavy-duty trucks, and followed earlier probes in April into imports of pharmaceuticals and semiconductors over national security concerns. In December, Trump said he would impose tariffs on Chinese semiconductor imports over what he called Beijing’s unreasonable pursuit of chip dominance, but he delayed that step until June 2027 after a year-long Section 301 investigation initiated under former President Joe Biden. The administration has also required that China-bound chips, manufactured in Taiwan, detour through the United States for third-party testing, where they are subject to the 25% tariff. An annex to the latest order clarifies that any 25% tariff imposed on semiconductors under this action will not be stacked on top of other Section 232 tariffs and that these chips will be exempt from existing duties on copper, aluminum and steel, and auto and truck parts.
While U.S. companies such as Nvidia, AMD and Intel design many of the most widely used chips, most manufacturing is carried out overseas, with a significant share produced by Taiwan Semiconductor Manufacturing Co, which did not immediately respond to a request for comment alongside the Semiconductor Industry Association. Nvidia also did not immediately comment, while AMD said in a statement that it complies with all U.S. export control laws and policies. The administration’s mix of targeted tariffs, exemptions for critical domestic users and the prospect of broader future measures suggests a calibrated approach for now, as officials weigh national security objectives against the needs of the semiconductor industry and downstream technology sectors.
