Kathmandu. The competition between the United States and China for global leadership in artificial intelligence and advanced technology has entered a new phase. Citing national security concerns, the technology-related restrictions imposed by the US on China have now dealt a massive blow to the American chip maker Nvidia itself. Nvidia’s dominance in China’s artificial intelligence chip market is declining, while Chinese company Huawei has begun to take its place.
At one time, Nvidia held a market share of around 95 percent in China’s artificial intelligence chip market. The company’s Chief Executive Officer, Jensen Huang, has also acknowledged that Nvidia had an almost exclusive presence in China before the US export restrictions. However, after the restrictions were implemented, the market situation changed rapidly. According to a report by the global research firm Bernstein, Nvidia’s share in China’s artificial intelligence chip market dropped to around 40 percent in 2025, reaching a state of parity with Huawei. This year, it is estimated that Nvidia’s market share will shrink further to around 8 percent, while Huawei’s share is projected to reach approximately 50 percent.
After the US banned Huawei in 2019 and subsequently restricted China from purchasing high-performance computer chips, Chinese companies accelerated domestic technology development. Analysts suggest that Huawei has directly benefited from this shift.
Huawei’s ‘Ascend 950’ series of artificial intelligence chips is considered competitive with Nvidia’s powerful ‘H-200’ chip. Similarly, China’s rapidly progressing artificial intelligence company ‘DeepSeek’ has developed its ‘V-4’ model with Huawei’s chips specifically in mind. According to analysts, Nvidia has already lost its lead in China, and local company Huawei has now reached a position to lead the market.
Nevertheless, despite China’s significant progress, the advanced semiconductor industry remains dependent on the global supply chain. The equipment and technology required to produce advanced artificial intelligence chips are not available within any single country. It is reported that China still requires Nvidia’s chips for training certain large-scale artificial intelligence systems.
For its chip production, Nvidia relies on advanced equipment from the Netherlands’ ASML company and the manufacturing capacity of Taiwan’s TSMC. The US has banned the sale of those ASML equipment to China. Although Nvidia attempted to sell the lower-capacity ‘H-20’ chip to China while staying within the scope of the restrictions, demand for it has been continuously declining, and the company has so far generated no revenue in China from its high-capacity ‘H-200’ chip.
According to experts, US export controls have unintentionally strengthened China’s domestic chip industry. China has now begun to place greater trust in its own technology and production capacity. Although Nvidia’s annual revenue in the global market remains much higher than Huawei’s, analysts believe it will be difficult for the company to reclaim its former position in China’s vast market. In the coming years, Huawei is expected to emerge as a major competitor in the supply of artificial intelligence chips not only in China but also in international markets, including Southeast Asia.
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