Nvidia's AI Chip Sales Stall in China, Huaweu Takes the Lead

Nvidia's NVDA AI chip sales in China have stalled, with domestic chipmakers led by Huawei moving to the front of the market. The shift is driven primarily by U.S. export controls, which have sharply curtailed what Nvidia can legally ship into China and opened the door for local alternatives. Before the restrictions tightened, Nvidia commanded roughly 95% of China's AI accelerator market.

Huawei has been the principal beneficiary. Analysts project the company could control around 60% of China's AI chip market by late 2026, with its Ascend-series accelerators capturing large domestic bulk orders. The reversal is one of the clearest examples yet of export policy reshaping competitive dynamics in a strategically critical technology market.

For NVDA, China was historically a meaningful slice of data-center revenue, so durable share loss there is a real headwind even as overall demand stays robust elsewhere. The longer-term risk is broader: as Chinese manufacturers scale capacity and lower prices, they could push beyond the home market into Southeast Asia and other regions, gradually contesting Nvidia in price-sensitive segments. Investors will watch the next earnings commentary for quantified China exposure and any change to export-license expectations.