Nvidia CEO Criticizes U.S. Chip Export Controls, Claims They Strengthened Chinese AI Industry

Nvidia's chief says U.S. chip controls on China have backfired

TAIPEI, Taiwan -- Lawmakers in Washington have worked for years to limit China's access to the cutting-edge computer chips needed for advanced artificial intelligence, particularly those made by Nvidia, America's leading chipmaker. But according to Nvidia's chief executive, Jensen Huang, those regulations, driven by economic and security concerns, have only made Chinese tech companies stronger. The export controls on chips forced Nvidia to forfeit its dominant position in China while domestic companies like Huawei, the telecommunications giant, filled the gap, Huang said at a news conference in Taipei, Taiwan's capital, on Wednesday. Washington's efforts gave Chinese companies "the spirit, the energy and the government support to accelerate their development," said Huang, who attended a tech conference in Taipei last week. "All in all, the export control was a failure." Beginning in 2022, under President Joe Biden, the U.S. government imposed rules to curb the export of Nvidia's most powerful chips to China. Nvidia responded by modifying one type of chip, making it less powerful so it would fall below the government's performance thresholds. Last month, Nvidia disclosed that U.S. officials were requiring a license for future sales of those chips to China, forcing the company to take a $5.5 billion hit on inventory it had already planned to sell. Although Huawei's chips cannot do everything that Nvidia's can, they work well enough to help Chinese companies provide AI services to people and businesses. In recent months, the government in Beijing has been pushing companies to stock their data centers with mostly Chinese-made chips. "AI researchers are still doing AI research in China," Huang said Wednesday. "If they don't have enough Nvidia, they will use their own." Huang has vowed that Nvidia will do everything it can to keep selling AI chips in China. The day after the U.S. government opened an investigation into whether Nvidia's previous sales to China had violated its rules, Huang met with top economic and trade officials in Beijing. Nvidia says it is concerned that any advantage gained by Huawei in China could eventually spread into other markets, helping Huawei build a stronger foundation from which to compete around the world. Washington's controls on chip exports have made it increasingly difficult for Nvidia to do business in China. The country accounted for $17 billion of Nvidia's revenue during its last fiscal year, by percentage the least in over a decade, according to Bernstein Research. Nvidia reported $130 billion in global revenue during its last fiscal year, an increase of 114% over the year before. "Four years ago, at the beginning of the Biden administration, Nvidia's market share in China was nearly 95%," Huang said. "Today it is only 50%." This month, the U.S. Commerce Department said any person or company using Huawei AI chips could be in violation of U.S. export controls. Countries around the world have been lining up to buy Nvidia chips, and the Trump administration has positioned itself as a deal broker. Huang was in the Persian Gulf region last week during President Donald Trump's visit there, as the administration struck multibillion-dollar agreements to sell advanced chips from Nvidia to Saudi Arabia and the United Arab Emirates. Officials in the administration believe these deals will boost business for American AI companies like Nvidia and widen the nation's lead in artificial intelligence. Huang criticized the approach taken by the Biden administration. "President Trump said very publicly he would like Nvidia to sell as many GPUs as possible all around the world," Huang said, referring to an Nvidia product needed for AI systems. He said it was important that China's artificial intelligence developers work on systems made by Nvidia "or at least on American technology."

Jensen Huang Says Biden-Era 'Export Control' Was A Failure: 'If They Don't Have Enough Nvidia, They Will Use Their Own' - NVIDIA (NASDAQ:NVDA)

Nvidia NVDA CEO Jensen Huang erupted at U.S. chip export restrictions during a closed-door media roundtable at Computex 2025, calling the Biden-era rules "a failure" that slashed the company's China market share in half and forced a multibillion-dollar write-off of unsellable H20 GPUs. What Happened: "Export control was a failure," Huang said, pointing to internal estimates that Nvidia's share of the Chinese data-center market fell from "nearly 95%" in 2021 to "only 50%" today, according to a transcript of the Computex Q&A session published by Tom's Hardware. He added that "export controls resulted in us writing off multiple billions of dollars... The write-off of H20 is as big as many semiconductor companies." The CEO stressed that the curbs did not stop Chinese firms from innovating: "If they don't have enough Nvidia, they will use their own! ...the local companies are very, very talented and very determined." Huang also cheered Washington's U-turn on a sweeping licensing scheme that would have capped AI-chip sales to dozens of U.S. allies. "I think it's really a great reversal of a wrong policy," he said of the Trump team's rollback. See also: Disney's 'Lilo & Stitch' Remake Leads Record $326 Million Memorial Day Box Office Weekend The H20 inventory charge, disclosed in April filings, totaled roughly $5.5 billion and wiped out potential China sales estimated at $15 billion. Nvidia now values next year's mainland AI-hardware market at "$50 billion... It would be a shame not to be able to enjoy that opportunity, to bring home tax revenues to the United States, [and] create jobs." Why It Matters: To stay within U.S. limits, Nvidia is rushing lower-spec Blackwell-based accelerators for China that swap costly HBM for GDDR7 and stay under the bandwidth cap, with production slated for June. The company has also told Chinese cloud giants it can ship a downgraded H20 as early as July. Talk of the rollback has already lifted semiconductor shares. Still, rival Huawei's Ascend 910B is clawing share, adding weight to Huang's warning that "AI researchers there are so good, and they're going to build amazing AI no matter what." Price Action: Nvidia shares closed lower by 1.16% to $131.29 on Friday, according to Benzinga Pro. Benzinga Edge Stock Rankings shows that Nvidia had a stronger price trend over the short, medium, and long term. Its momentum ranking was solid, however, its value ranking was poor at the 6.61th percentile. The details of other metrics are available here. Photo Courtesy: jamesonwu1972 On Shutterstock.com Read next: Chamath Palihapitiya Flags Rising Investor Fear As Money Market Fund Assets Hit $7.24 Trillion: 'Market Is Risk-Off' NVDANVIDIA Corp$131.17-1.25%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentum82.17Growth98.78Quality93.95Value6.61Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs