Nvidia Concedes China AI Chip Market to Huawei

CNBC reported Wednesday that Nvidia CEO Jensen Huang told the network the chipmaker has “largely conceded” China’s AI chip market to Huawei. His remarks came during an earnings call after Nvidia posted another record-breaking quarterly performance.

Blockbuster Quarter Overshadowed by China Flashpoint

Nvidia’s quarterly revenue surged 85% year-over-year to $81.62 billion, up from $44.06 billion in the same period a year prior. The company also announced an $80 billion share buyback and lifted its dividend. Despite the strong results, China remained a dominant theme in investor conversations.

Huang told CNBC that demand inside China remains substantial. He described Huawei as “very, very strong,” noting the firm posted a record year and is likely heading for an even stronger one. He said Nvidia had effectively withdrawn from that market, leaving room for Huawei and a broader domestic chip ecosystem to fill the gap.

Also Read: What Huawei’s AI Chip Push Means for the Semiconductor Race

How US Export Rules Reshaped the Landscape

China’s AI chip market was once a major revenue contributor for Nvidia. The country had historically accounted for at least one-fifth of Nvidia’s data center sales. That changed when the Trump administration moved to require export licenses for Nvidia chip sales into China and several other markets.

Huang told investors to “expect nothing” regarding approvals to sell advanced chips into China. He was direct about the outlook, saying Nvidia had set guidance and analyst expectations accordingly. The CEO did leave the door open, stressing that Nvidia remained eager to re-enter China should restrictions ease and that the company had maintained relationships there for three decades.

Also Read: Reuters: Some Chinese Firms Received H200 Approval From Commerce Department

Diplomatic Movement Has Yet to Unlock the Market

Huang was a late addition to President Donald Trump’s China summit last week in Beijing. The visit generated attention but produced no firm clarity on whether Nvidia’s H200 chips would gain broader approval. A US trade representative confirmed that chip export controls were not part of the formal agenda, suggesting meaningful relief remains some way off.

Reuters separately reported that select Chinese companies, including Alibaba, Tencent, ByteDance, and JD.com, had received limited Commerce Department approval to buy H200 chips. That approval has not translated into a wholesale policy shift.

Nvidia Eyes a Much Larger Long-Term Opportunity

Beyond China, Huang sketched out an expansive growth vision. He described the AI economy as a “five-layer cake” spanning energy, chips, infrastructure, models, and applications. He said the idea of Nvidia growing into a company “many times larger” was not far-fetched. The CEO also said the company’s first priority for its growing cash reserves was supporting its supply chain as demand scales by hundreds of billions of dollars at a time.

Read Next: What US Export Controls Mean for the Global Semiconductor Supply Chain