NVIDIA Faces Massive Market Collapse in China; Share Expected to Drop from 66% to 8%
NVIDIA’s position in China’s artificial intelligence market is facing a critical moment. According to an analysis by Bernstein, reported by Nikkei Asia, the U.S. chipmaker could see its market share in China drop from the current 66% to just 8% in the coming years. This sharp decline is driven by two main factors — the export restrictions imposed by the United States and the rapid growth of local Chinese manufacturers.
The U.S. government has restricted the sale of NVIDIA’s advanced GPUs to China, aiming to limit the country’s progress in AI technologies that might have military applications. These measures, combined with China’s own internal regulations, have made it difficult for NVIDIA to supply its highly demanded AI products, such as the A100 and H100 series.
Rise of Chinese Competitors
At the same time, Chinese companies like Huawei have accelerated their production of AI chips, managing to cover up to 80% of the domestic demand with their Ascend accelerators. This growth reflects China’s long-term strategy of technological self-sufficiency.
Other local players are also joining the race. The Huashan chip from Moore Threads directly competes with NVIDIA’s Hopper H100 and H200 series, though it still lags behind the latest Blackwell (B200/B300) architecture, whose export to China is prohibited. Meanwhile, Huawei’s CloudMatrix 384 AI system has reportedly outperformed NVIDIA’s GB200 systems in BF16 training performance.
Looking ahead, Huawei plans to deploy the Atlas 950 SuperCluster, which is projected to reach 4 ZettaFLOPS of computing power by 2028. While this remains below the performance of Western superclusters such as Oracle’s, it clearly shows that Chinese developers are rapidly closing the gap in hardware capability.
NVIDIA’s decline in China could have far-reaching effects beyond its revenue loss in the region. China is one of the world’s largest consumers of AI hardware, and its growing independence in chip development poses a major challenge to Western companies.
