Nvidia China market share plummets to 55% as Chinese chipmakers capture 41% with 1.65 million AI GPUs

Nvidia market share in China falls to less than 60% -- Chinese chip makers deliver 1.65 million AI GPUs as the government pushes data centers to use domestic chips

Chinese semiconductor firms have taken a big chunk of the domestic market, claiming 41% of the local AI server market and delivering 1.65 million AI GPUs out of a total of 4 million units in 2025. IDC numbers reported by Reuters claim that Nvidia still leads with a 55% market share, shipping an estimated 2.2 million cards, but this is a major contraction compared to the company's claimed 95% market share before sanctions. Huawei is reported to be the big winner among the Chinese chipmakers, shipping around 812,000 AI chips or nearly 20% of the market. The Shenzhen-based firm is continuing development of AI processors, with the company launching its Atlas 350 AI accelerator last week, which is claimed to have nearly three times the performance of Nvidia H20 chips. T-Head, which is owned by Alibaba, the e-commerce platform widely known as China's Amazon, holds a distant third place with 256,000 units sold. AMD sits just outside of the top three chipmakers in China, shipping 160,000 units for a 4% share of the domestic AI chip market. Baidu's Kunlunxin AI chip subsidiary and Chinese AI chip maker Cambricon round out the top five, with each company delivering 116,000 cards. Even though the U.S. banned Nvidia and AMD from selling their most advanced chips to China in 2023, many Chinese tech firms still favored nerfed versions of their latest AI GPUs, like the Nvidia H20 and AMD MI308. However, U.S. President Donald Trump completely banned all AI GPU exports in April 2025, forcing Chinese companies to rely on domestic chip makers. Trump reversed the ban on the H20 and MI308 in July 2025, but Chinese companies were told to stop ordering Nvidia's chips after U.S. Commerce Secretary Howard Lutnick's "addition" comments during an interview. In December 2025, Trump made a complete U-turn and finally allowed Nvidia to ship the H200 to China, but it took several months before Chinese companies were allowed to order the U.S.-only chips, and only for specific institutions and applications. Beijing is facing a dilemma as it wants to support its domestic chip industry but also wants its AI tech companies to remain competitive on the global stage. While Chinese chip makers have advanced by leaps and bounds in recent years, it still lags five to ten years in AI data center chips compared to Nvidia and AMD. Despite that, the Chinese government's efforts seem to be paying off, as seen by the increasing market share of local chip makers. We have yet to see if Washington's move to allow Nvidia to sell its H200 chips to China will see the company regain its lost market share in 2026. But even if Chinese companies are eager to purchase these AI GPUs en masse, Beijing's effort to redirect some of the demand towards domestic semiconductors will likely mean that Nvidia would have a hard time returning to pre-sanctions market share. Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds.

Chinese chipmakers claim nearly half of local market as Nvidia's lead shrinks

BEIJING, April 1 (Rtrs) - Chinese GPU and AI chip makers captured nearly 41% of China's AI accelerator server market last year, eroding Nvidia's once-dominant position in one of its most important overseas markets, according to data from an IDC report reviewed by Reuters. The gains come as Beijing grows increasingly cautious about dependence on foreign chips, pushing government agencies and companies to adopt ⁠domestic alternatives after successive waves of U.S. export controls cut China off from Nvidia's most advanced products. Total shipments of AI accelerator cards by Nvidia, AMD, and Chinese chipmakers reached approximately 4 million units in China in 2025, the data showed. Nvidia remained the market leader, shipping around 2.2 million cards and holding a 55% share. But that figure marks a significant retreat for the U.S. chipmaker, which held a dominant market share in China's AI chip market. AMD carved out a modest presence, shipping roughly 160,000 cards ⁠for a 4% share, the IDC data showed. Chinese vendors collectively shipped 1.65 million cards, accounting for 41% of the total market -- a milestone that underscores how aggressively domestic players have moved to fill the void left by tightening U.S. export controls. Huawei Technologies emerged as the runaway ⁠leader among Chinese vendors, shipping around 812,000 AI chips, roughly half of all domestically branded shipments. Alibaba's chip design unit T-Head claimed second place, shipping approximately 265,000 cards. Baidu's Kunlunxin and Cambricon each shipped ⁠around 116,000 cards, ranking them jointly third among Chinese vendors. Hygon, GPU startups MetaX and Iluvatar CoreX accounted for 5%, 4% and 3% of total Chinese vendor shipments, ⁠respectively. In 2025, the central government launched a new wave of AI infrastructure spending, with local governments accelerating intelligent computing centers across provinces, many of which carried implicit directives to "buy Chinese." Reporting by Che Pan and Laurie Chen, Editing by Louise Heavens Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Artificial Intelligence Laurie Chen Thomson Reuters Laurie Chen is a China Correspondent at Reuters' Beijing bureau, covering politics and general news. Before joining Reuters, she reported on China for six years at Agence France-Presse and the South China Morning Post in Hong Kong. She speaks fluent Mandarin.

Chinese chipmakers claim nearly half of local market as Nvidia's lead shrinks

The gains come as Beijing grows increasingly ⁠cautious ⁠about dependence on foreign chips, pushing government agencies and companies to adopt domestic alternatives after successive waves of U.S. export controls cut China off from Nvidia's most advanced products. Chinese GPU and AI chip makers captured nearly 41% of China's AI accelerator server market last year, eroding Nvidia's once-dominant position in one of its most important overseas markets, according to data from an IDC report reviewed by Reuters. The gains come as Beijing grows increasingly ⁠cautious ⁠about dependence on foreign chips, pushing government agencies and companies to adopt domestic alternatives after successive waves of U.S. export controls cut China off from Nvidia's most advanced products. Total shipments of AI accelerator cards by Nvidia, AMD, and Chinese chipmakers reached approximately 4 million units in China in 2025, the data showed. Nvidia remained the market leader, shipping around ⁠2.2 million cards and holding a 55% share. But that figure marks a significant retreat for the U.S. chipmaker, which held a ⁠dominant market share in China's AI chip market. AMD carved out a modest presence, shipping roughly 160,000 cards for a 4% share, the IDC data showed. Chinese vendors collectively shipped 1.65 million cards, accounting for 41% of the total market - a milestone that underscores how aggressively domestic players have moved to fill the void left by tightening U.S. export controls. Huawei Technologies emerged as the runaway leader among Chinese vendors, shipping around 812,000 AI chips, roughly half of all domestically branded shipments. Alibaba's chip design unit T-Head claimed second ⁠place, shipping approximately 265,000 cards. Baidu's Kunlunxin and Cambricon each shipped around 116,000 cards, ranking them jointly third among Chinese vendors. Hygon, GPU startups MetaX and Iluvatar CoreX accounted for 5%, 4% and 3% of total Chinese vendor shipments, respectively. In 2025, the central government launched a new wave of AI infrastructure spending, with local governments accelerating intelligent computing centers across provinces, many of which carried implicit directives to "buy Chinese."

How US Export Curbs Are Fueling China's Chip Boom - NVIDIA (NASDAQ:NVDA)

AI Boom And Nvidia Curbs Fuel Domestic Growth Chinese chipmakers reported record revenue and expect further gains as domestic tech firms ramp up AI infrastructure. Paul Triolo of Albright Stonebridge Group told CNBC on Friday that the U.S. restrictions have added "rocket fuel" to demand, while export curbs on Nvidia chips are pushing China to adopt local alternatives. Companies like Huawei and Moore Threads are stepping in to fill the gap, even as they trail U.S. performance. Parv Sharma of Counterpoint Research said these domestic solutions are helping fill the "compute gap" and driving strong revenue growth. Memory Shortage Opens Door For Local Players Global shortages of memory chips and rising prices are boosting Chinese firms like ChangXin Memory Technologies (CXMT), which saw revenue surge sharply. Restrictions on advanced memory imports have created opportunities for CXMT to emerge as a domestic option. Morningstar's Phelix Lee said that even older memory technologies are seeing strong demand as China builds its own supply base. Growth Continues Despite Technology Gap Triolo said China is trying to rebuild large parts of the semiconductor supply chain, a complex effort that will take time under ongoing export controls. Sharma added that long-term growth will depend on whether China can move into advanced memory and next-generation chips, as risks of overcapacity remain in less advanced segments. Talent War Adds New Layer To Chip Race Analysts describe the trend as a "quiet tech war," with China aggressively pursuing skilled workers to support its AI ambitions, even as U.S. restrictions limit access to advanced tools. Taiwan, home to Taiwan Semiconductor, remains a critical talent hub but faces ongoing "brain drain" pressures due to higher wages and recruitment efforts from mainland firms, the report noted. At the same time, China is investing heavily in domestic education and global hiring, while the U.S. is also seeking to attract Taiwanese expertise -- underscoring that human capital is becoming as strategic as technology in the global chip race. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.