Nvidia CEO Jensen Huang said the company’s share of China’s AI accelerator market had fallen to zero in remarks concerning direct sales to Chinese customers. He argued that U.S. export controls were encouraging Chinese alternatives and weakening the reach of American technology.
“In China, we have now dropped to zero,” Huang said in an interview with the Special Competitive Studies Project.
“Conceding an entire market the size of China probably does not make a lot of strategic sense, so I think that has already largely backfired,” he said.
Nvidia’s financial outlook provides a separate measure of its expectations for China. In its fiscal 2026 earnings release, the company said its outlook for the first quarter of fiscal 2027 assumed no Data Center compute revenue from China. That forecast does not establish its market share or the amount of Nvidia hardware already operating in the country.
Conditional licensing remains available
U.S. policy provides a conditional route for exports of certain advanced chips to China. On January 13, 2026, the Commerce Department’s Bureau of Industry and Security announced a policy to review export-license applications for Nvidia’s H200, AMD’s MI325X and similar chips on a case-by-case basis, subject to security requirements.
Applicants must demonstrate that the exports would not reduce semiconductor production capacity available to U.S. customers, that Chinese purchasers have adopted export-compliance procedures, and that the products have undergone independent performance and security testing in the United States.
Under Secretary for Industry and Security Jeffrey Kessler said permitting H200 sales under controlled conditions would strengthen the American technology ecosystem. The licensing policy provides for conditional review; it does not itself establish that shipments have taken place.
Competition includes chips and software
Chinese companies developing AI chips include Huawei, Cambricon, Moore Threads and MetaX. Huang argued that excluding American suppliers from China could encourage customers to adopt domestic hardware and software, while continued participation would help extend adoption of the U.S. AI technology stack.
Chinese suppliers are also developing software ecosystems. Huawei said in its 2025 annual report that its Ascend ecosystem had 4 million developers and that it had made its Ascend CANN and Mind series software open source.
Huang also cited China’s science and mathematics workforce, its AI researchers and what he described as cheaper energy as advantages in AI competition despite restrictions on access to American chips.
