Trump’s Nvidia Deal Turns Armenia Into Surprising AI Hotspot

Firebird, a San Francisco-based startup founded by people of Armenian descent, began operating a data center in Hrazdan, Armenia, in August that is set to reach 300 megawatts and more than 70,000 Nvidia chips by the end of next year, with a fifth of its computing power reserved for domestic research, government and startups and the remainder allocated to foreign firms including Perplexity AI. President Donald Trump's team promised permission for Nvidia exports to help advance a historic US-brokered peace treaty between Armenia and Azerbaijan, according to people involved in the talks, a deal first reported by the Wall Street Journal. Nvidia established its Armenia presence in 2022 and evacuated engineers from Moscow to Yerevan after Russia's invasion of Ukraine, while CEO Jensen Huang's visit the following year helped lay the groundwork for Firebird's creation, CEO Razmig Hovaghimian said.

Bloomberg -- During the Cold War, the Soviet Union's smallest republic was an electronics and tech center for the Communist superpower. Now Armenia is on track to become one of the world's top hubs for American AI infrastructure. Most Read from Bloomberg In August, a San Francisco-based startup called Firebird began operations of a data center in Armenia that's set to reach 300 megawatts and more than 70,000 cutting-edge Nvidia Corp. chips by the end of next year. A fifth of its computing power is reserved for domestic use — to power local research, government and startup ecosystems — with the remainder allocated to foreign firms, including US ones like Perplexity AI. The complex in the town of Hrazdan, about 45 kilometers 28 miles outside the capital Yerevan, is on track to be the largest computing cluster in the region and would rank among the largest in Europe, says Firebird, whose founders are of Armenian descent. That's an economic edge with far-reaching implications for the South Caucasus and neighboring Central Asia, where Firebird is already expanding and where major powers are competing for dominance in a strategic corridor that links Europe and China bypassing Russia. The data center already played a role in securing a peace treaty between Armenia and neighboring Azerbaijan after decades of conflict over a disputed territory that killed tens of thousands and severed their economic relations. President Donald Trump's team promised permission for Nvidia exports in order to advance conversations with Armenia on the way to a historic US-brokered accord with Azerbaijan, according to people involved in the talks. The role of Nvidia chips in that deal, first reported by the Wall Street Journal, is one of the more extraordinary examples of Trump's unorthodox approach to AI diplomacy. It shows how Trump's team utilizes certain chip export regulations introduced under the Joe Biden administration, while criticizing their predecessors' broader approach, to achieve goals that extend far beyond technology. It also underscores the ambitions of a small nation of about 3 million people that's attempting to carve out a role at the heart of the fast-changing region — and how years of work by Yerevan to lay the foundation for tech investment and assuage US concerns about Russian influence are starting to pay off in the AI age. "Sovereignty in general has been a real issue in Armenia" since the country's independence from the Soviet Union, said Rich Goldman, who founded the Armenia division of chip design giant Synopsys Inc., a key Nvidia partner. That plays into "all this paranoia about having to own your AI," he said. The White House didn't respond to a request for comment. A spokesperson for Prime Minister Nikol Pashinyan's office said he had a clear mandate for establishing peace with Azerbaijan and that bilateral agreements signed in Washington last year, including on semiconductors and artificial intelligence, represented important peace dividends for Armenia. Armenia's engagement with Nvidia dates back to 2019, when Pashinyan visited the chipmaker's Santa Clara office — years before OpenAI launched ChatGPT and ignited the AI boom. That meeting was arranged by Hakob Arshakyan, a former lawmaker who was Armenia's founding high-tech minister and now chairs the board of a foundation that promotes Armenian innovation and includes tech and IT executives from across its global diaspora. Nvidia established its Armenia presence in 2022, and evacuated engineers from Moscow to its office in Yerevan after Russia's full-scale invasion of Ukraine that February. Chief Executive Officer Jensen Huang visited the Caucasus nation the following year — a trip that helped lay the groundwork for Firebird's creation, CEO Razmig Hovaghimian said in a statement. Also in 2023, Armenia began distancing itself from Russia, its largest trading partner and primary arms supplier, after accusing Moscow of failing to honor a defense pact and repel encroachment on its territory by Azerbaijan. That followed a lightning military campaign by Baku to take full control of the disputed territory of Nagorno-Karabakh, triggering an exodus of its ethnic Armenian population and ending the conflict that had erupted into war multiple times since the Soviet collapse. Yerevan set out to build more ties with the West, including in technology, an area where Armenia had a long history and strong talent. But those ambitions took a hit from Washington, which worried Armenia could be a conduit for Russia to get hold of American hardware and fuel President Vladimir Putin's war machine in Ukraine. The Biden administration had already effectively barred China and Russia from buying advanced AI chips in October 2022, in addition to more sweeping sanctions targeting Moscow. The rules have proven far from airtight. Chinese tech companies have allegedly secured billions of dollars worth of restricted Nvidia hardware, while more prosaic American components regularly appear in Russian missiles, usually supplied via intermediary countries. Armenia is part of a Moscow-led customs union, and remains formally a Russian ally. Still, Pashinyan responded to US and European pressures in early 2023 by imposing stringent restrictions on electronics exports to Russia. Armenia "cannot afford to be placed under Western sanctions," he said at the time, according to local media. "In our relations with Russia we will act on a scale that allows us to avoid" that outcome. A few months later, Washington accused a Russian semiconductor executive of using a constellation of Taiwanese, Swiss and Armenian shell companies to smuggle microchips for Russian weapons that strike Ukrainian cities. Toward the end of 2023, Biden's team started requiring US licenses for AI chip exports to Armenia and more than 40 other nations, including most former Soviet states and much of the Middle East. Yerevan's efforts to get off that list haven't borne fruit. But Armenia continued working with Biden officials to get some chips. In 2024, after more than six months of talks, a state university project secured export licenses for a batch of 64 of Nvidia's flagship H100 accelerators for what was then the largest supercomputer in the region, according to Arshakyan, who was involved in that process. It took more than a year to get the project up and running because Armenia lacked knowledge of building data centers, Arshakyan said. But the experience provided crucial expertise on everything from specialized construction to US export regulation, he added, making Firebird's data center — plus another by Armenian firm Eleveight AI — possible. Eleveight AI is now considering a Kazakhstan expansion, a spokesperson said, though nothing has been finalized. Those bigger data centers still require US permission. While Trump has relaxed core parts of Biden's chip restrictions, his team left largely intact regulations imposed in 2023 while they work on their own global framework — and they've made use of those earlier rules. In the United Arab Emirates and Saudi Arabia, for example, Trump officials withheld chip export licenses until the Gulf nations agreed to provisions restricting China's potential access as well as investments in the US. In Armenia, chip export permits became part of the negotiations for getting the peace deal over the line with Azerbaijan. The treaty, which hasn't been signed yet, paves the way for a crucial transport corridor across Armenia from Azerbaijan to its exclave of Nakhchivan bordering Turkey, the so-called Trump Route for International Peace and Prosperity that will be managed jointly by the US and Yerevan. TRIPP aims to "strengthen the prosperity and security of Armenia and Azerbaijan and expand US commercial opportunities by expanding regional trade and connectivity, as well as create new transit links from Central Asia and the Caspian to Europe," a State Department spokesperson said in a statement. The agency referred queries on export licenses to the Commerce Department, which oversees those permits and didn't respond to questions. Firebird and its partners first sought permission to buy Nvidia chips in early 2025, according to a spokesperson, before the company was officially launched a few months later. It secured an initial batch of US licenses ahead of the White House peace summit in August of that year, the spokesperson said, adding that Firebird wasn't privy to diplomatic discussions happening at that time. It's unclear exactly when the Trump administration first approached Nvidia about the role the data center could play in facilitating the preliminary peace accord, which Pashinyan and Azerbaijani President Ilham Aliyev sealed on the same day as the US and Armenia signed a bilateral AI and semiconductor partnership memorandum. "Armenia has extraordinary technical talent and a vibrant, growing innovation ecosystem. That's why we began investing in its future long ago," an Nvidia spokesperson said. "We know Armenia can create economic opportunity, which in turn strengthens regional ties and can help support a foundation for enduring stability." Firebird has now secured more than double the number of Nvidia processors that the US licensed for export to Saudi Arabia's Humain after months of talks with Riyadh, whose pockets are deeper than Yerevan's by orders of magnitude. "The Armenian and US governments have been incredibly supportive of our vision and growth plans in Armenia," Hovaghimian said. "Peace and regional stability create the conditions for investment, innovation, growth and global partnerships to thrive." Firebird started operations last month, exactly one year since the White House summit — using chips that, as Vice President JD Vance noted during a February visit to Yerevan, "simply do not exist in most countries." Most Read from Bloomberg Businessweek ©2026 Bloomberg L.P.