Nvidia's China AI‑Chip Share Slides to One‑Third as Huawei Expands

Nvidia's share of China's data‑centre AI‑chip market fell to 34% in the first half of 2026, as US export controls limited its sales and Huawei lifted its share to 28%. Nvidia shipped 678,000 AI accelerators in China from January to June, a 44% decline from the previous year. The drop reflects Washington's restrictions on the company's most powerful chips and Beijing's push for domestic substitutes. Nvidia CEO Jensen Huang has repeatedly criticised Washington's export curbs, saying the policy forced a US company to cede China's $50 billion AI‑chip market to Huawei.

Market Shift

Huawei delivered 572,000 AI accelerators, up from just over 300,000 a year earlier, giving it a 28% market slice. Alibaba's T‑Head held 7%, Cambricon 5%, Baidu's Kunlunxin 4% and Hygon 3%. Nine of the 11 Chinese chipmakers tracked by IDC increased shipments year‑on‑year. Total AI‑accelerator shipments reached 2.008 million units, while GPU shipments fell 26% to 991,000 units because many models remain barred from export. Non‑GPU AI accelerators rose nearly 80% to 1.016 million units, overtaking GPUs by volume.

Domestic Response

Beijing has promoted local alternatives and requires firms to obtain approval before importing compliant Nvidia chips. IDC noted the competition is moving from single‑chip performance to system‑level capabilities across larger clusters. It expects overall accelerator shipments in China to grow 19% this year, even as GPU shipments are projected to drop 9%.

Context

Export restrictions and a policy of domestic substitution are reshaping China's AI‑chip landscape, pushing local firms to capture market share previously dominated by foreign suppliers.