The US government will allow Nvidia to export its H200 artificial intelligence chips to China, collecting a fee for each chip, US President Donald Trump said on Monday.

Nvidia shares rose 1.2 percent in after-hours trading after Trump made the announcement on Truth Social, having closed 3.16 percent higher after Semafor first reported the possibility of approval.

Trump said that he had informed President Xi Jinping, where Nvidia's chips are under government scrutiny, about the move and he "responded positively," according to Trump's post.

Trump said the US Commerce Department was finalising details of the arrangement and the same approach would apply to other AI chip firms such as Advanced Micro Devices and Intel.

"We will protect National Security, create American Jobs, and keep America’s lead in AI," Trump wrote on Truth Social.

"NVIDIA’s US Customers are already moving forward with their incredible, highly advanced Blackwell chips, and soon, Rubin, neither of which are part of this deal."

The announcement marks a significant shift in US export policy for advanced AI chips, which Joe Biden's administration had heavily restricted over US national security concerns about Chinese military applications.

Under Biden-era restrictions, the H200 and similar advanced chips were blocked from export to China.

First released in the second quarter of 2024, the H200s are roughly 18 months behind the company's state-of-the-art offerings.

The chips – graphic processing units or GPUs – are used to train the AI models that are the bedrock of the generative AI revolution.

Nvidia CEO Jensen Huang has lobbied the White House intensely to reverse the Biden-era policy despite considerable opposition in Washington to giving Chinese companies access to the chips.

China's cybersecurity regulator summoned Nvidia to a meeting to explain whether its H20 AI chip had any backdoor security risks, an allegation Nvidia has denied, Reuters reported in August. (Agencies)