Nvidia says it has ‘largely conceded’ China’s AI chip market to Huawei
Nvidia CEO Jensen Huang said the company has “largely conceded” China’s AI chip market to Huawei as U.S. export restrictions continue to reshape the global AI semiconductor landscape.
Huang’s comments came as Nvidia reported another blockbuster quarter; revenue rose 85% to $81.62 billion from $44.06 billion the previous year. The company also announced an $80 billion share buyback program and increased its dividend.
But China remained a major flashpoint.
“The demand in China is quite large,” Huang told CNBC’s Sara Eisen. “Huawei is very, very strong. They’ve had a record year, they’re probably going to have a phenomenal year, and the ecosystem of local chip companies is doing pretty well because we’ve emptied that market.”
“We’ve really handed over this market to them in a big way,” he added.
The revelations underscore how Washington’s tightening restrictions on advanced AI chip exports are accelerating Beijing’s move toward semiconductor self-sufficiency.
The Chinese market once accounted for at least a fifth of Nvidia’s data center revenue. But the company has effectively been locked out of the market after the Trump administration told Nvidia in April that it would need a license to export chips to China and several other countries.
In an interview with CNBC, Huang sounded cautious about expectations for the near-term reopening of the Chinese market, saying Nvidia had told investors “not to expect anything” regarding approvals to sell advanced chips to the country.
The ‘five-layer cake’ of the AI industry
“I have no expectations, so we’re putting out all of our guidance, all of our numbers, all of the expectations that I’ve set with all of our analysts and investors to invest nothing, expect nothing,” Hang said.
Still, he suggested Nvidia is willing to return if conditions improve.
“We would be delighted to serve the market,” Huang said. “We have a lot of customers there, a lot of partners, and we’ve been there for 30 years.”
Huang was added at the last minute President Donald Trump’s China summit last week, but the visit said little about whether Nvidia’s H200 chips would be allowed in the country.
Reuters reported last week that some Chinese companies had received approval from the US Commerce Department to buy H200 chips, including Alibaba. TencentByteDance and JD.com.
Still, a U.S. trade representative said chip export controls were not part of discussions at China talks last week, indicating that a significant easing of restrictions on H200 sales may remain distant.
Nvidia is also aggressively expanding its supply chain as it prepares for what Huang describes as a massive growth opportunity tied to the broader AI economy.
“idea [a] “Most of the time, a larger company is out of the question,” Huang said, adding that Nvidia is investing heavily in what he calls the AI industry’s “five-layer pie” spanning energy, chips, infrastructure, models and applications.
Huang said Nvidia’s first priority, given its growing cash pile, is to support suppliers amid rising demand.
“As we grow by hundreds of billions of dollars at a time, we must support our supply chains so they can support our growth,” he said.
— CNBC’s Sara Eisen and Katie Tarasov contributed to this report.
