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Nvidia's China data-centre AI chip share falls to 34 percent as Huawei closes gap
Nvidia's China AI-chip market share fell to 34% in H1 2026 as shipments dropped 44% year-on-year to 678,000 units, while Huawei nearly doubled its shipments to 572,000.
Nvidia's share of China's data-centre AI chip market dropped to 34% in the first half of 2026, as US export controls squeezed supply and domestic competitor Huawei nearly doubled its shipments, according to an IDC report seen by Reuters. The shift marks a sharp reversal for the US chipmaker, which shipped 678,000 AI accelerators in China from January through June - a 44% decline from a year earlier.
Washington has restricted China's access to Nvidia's most powerful AI chips, limiting the products it can sell in the world's second-largest economy. Beijing has responded by promoting domestic alternatives and requiring Chinese companies to seek approval before importing compliant Nvidia chips.
Nvidia CEO Jensen Huang has repeatedly criticised the export curbs, saying the policy forced a US company to cede China's US$50 billion AI chip market to Huawei. Nvidia did not respond to a request for comment.
Huawei and domestic rivals gain ground
Huawei shipped 572,000 AI accelerators during the period, up from more than 300,000 a year earlier, giving it a 28% share of the overall market. Alibaba's chip-design unit T-Head held 7%, followed by Cambricon with 5%, Baidu's Kunlunxin with 4% and Hygon with 3%. Nine of the 11 Chinese chipmakers tracked by IDC increased shipments from a year earlier.
Total AI-accelerator shipments in China reached 2.008 million units in the first half. GPU shipments - the chips most widely used to train AI models - fell 26% to 991,000 units, as supplies eligible for sale in mainland China remained limited.
Shipments of other AI accelerators, a category that includes chips designed for specific tasks such as running trained models, rose nearly 80% to 1.016 million units, overtaking GPUs by volume. Huawei, T-Head, Kunlunxin and Cambricon together accounted for 95% of that non-GPU segment, which IDC said was being adopted by government agencies, internet companies and telecoms providers.
System-level competition reshapes the market
IDC said competition was shifting from the performance of a single chip to system-level capabilities, including how well chips work in a larger computing cluster. The research firm expects total accelerator shipments in China to grow 19% this year, even as GPU shipments fall 9%.
IDC did not specify which Nvidia products made up its 34% market share, or whether the figure included cutting-edge chips such as the B200 and B300, which are barred from export to China but have been smuggled into the country.
Why this matters for executives and strategy
The IDC data confirms that US export controls are reshaping China's AI chip supply chain faster than many expected. For strategy leaders, the shift from GPU dominance to a mix of specialised accelerators signals that AI infrastructure decisions are becoming more fragmented - and more political. Companies building or funding AI capacity in China now face a market where domestic alternatives are not just available but scaling rapidly, with Huawei alone approaching Nvidia's shipment volumes. Professionals tracking these dynamics may find structured guidance through AI Strategy Development Courses useful for evaluating how chip-supply constraints affect AI procurement and deployment planning.