Nvidia CEO Admits Company Has 'Conceded' China's AI Chip Market to Huawei

Nvidia CEO Jensen Huang has acknowledged that the company has "largely conceded" China's AI chip market to domestic rival Huawei. The admission, made during a recent interview, marks one of the most dramatic shifts in the global semiconductor landscape and highlights how US-China geopolitical tensions are permanently reshaping the artificial intelligence industry.

US Export Controls Push Nvidia Out

The shift traces back to a series of US export controls starting in 2022 that progressively restricted Nvidia's most powerful chips from reaching Chinese buyers. Advanced processors including the A100 and H100 were banned outright, and even the specially downgraded H20 chip — designed to comply with earlier rules — was eventually blocked from sale. The restrictions have been devastating for Nvidia's position in what was once a critical revenue market.

At its peak, Nvidia held roughly 95 percent of China's advanced AI accelerator market. An AI accelerator is a specialized chip designed to handle the intense mathematical calculations required by machine learning models. That dominant market share has now collapsed to effectively zero percent. Huang told analysts to "expect nothing" regarding future approvals, suggesting the company sees no near-term path back.

Huawei Steps Into the Vacuum

With Nvidia sidelined, Huawei has moved aggressively to fill the gap. The Chinese technology giant's new Ascend 950PR processor went into mass production in March and has already secured bulk orders from major Chinese tech companies. Huawei's AI chip sales are projected to reach approximately 12 billion dollars in 2026, up sharply from 7.5 billion dollars the previous year.

Huang acknowledged the competition directly, stating that "Huawei is very, very strong" and noting their local ecosystem of chip companies is thriving because Nvidia has "evacuated that market." China's total AI chip market is now estimated at roughly 50 billion dollars, with the domestic segment alone valued between 30 and 35 billion dollars.

The situation grew more complex when Commerce Secretary Howard Lutnick cleared nearly ten Chinese companies to purchase Nvidia's H200 chips, only for Beijing to instruct those same firms to invest exclusively in homegrown alternatives. Despite this setback, Huang expressed hope for an eventual return, citing Nvidia's 30 years of partnerships in the region and describing the company as "more than delighted" to re-enter should conditions change.