The Chinese giant now holds 20% of the semiconductor market in the country, according to 2025 figures published by the research firm IDC.
« De 95 % à 50 %»: last May, the boss of Nvidia, angered by the loss of half of the Chinese market, castigated the rules from Washington which force the American champion to limit the sale of its semiconductors to China. Eleven months later, a new report from IDC shows that Nvidia’s decline in China continues. And the big winner in the situation is Huawei, which has taken the lion’s share of the country’s supply of electronic chips – these components are used in the manufacture of smartphones, artificial intelligence, cars and even electric batteries.
According to figures from the research firm, including Reuters echoed this Thursday, April 2, Chinese chip manufacturers have captured almost half of the local market, even if Nvidia still remains in the lead. This is despite Washington’s export restrictions, which prevented it for several months (from April to December 2025) from selling its latest generation chips to Chinese entities, for reasons of “national security”.
41% of AI chips were delivered by Chinese suppliers
In 2025, deliveries of semiconductors intended for AI by all manufacturers, whether American or Chinese, will reach 4 million units in China.
- on the American firm side: Nvidia delivered 2.2 million (i.e. a market share of 55%). AMD sold 160,000, which represents 4% of the market.
- On the Chinese supplier side: local companies supplied nearly 1.65 million chips, or 41% of the total market. The fear expressed last year by Jensen Huang, head of Nvidia, has therefore come true. The void left by the world leader in electronic chips, due to the tightening of export restrictions, has been filled by Chinese suppliers.
Beijing has also pushed for its companies to source local chips: the government encourages data centers to use domestic chips.
Also read: IA: Beijing multiplies blank checks to catch up with American leaders
Huawei at the top of Chinese suppliers
And the big winner from this policy is Huawei, which delivered half of Chinese chips last year (812,000), which represents 20% of the market. The Chinese giant, based in Shenzhen in southern China, launched its Atlas 350 AI chip last week, which would be nearly three times more efficient than the Nvidia H20 chips, the only ones to be authorized for sale in the country. In 2023, the company was one of five local companies on which Beijing was banking to replace American semiconductors – which meant receiving, without conditions, substantial subsidies, explained the Financial Times.
Also read: Semiconductor war: China prints money to save Huawei
After Huawei, we find the semiconductor subsidiary of Chinese e-commerce giant Alibaba, T-Head, which delivered nearly 265,000 chips to China, then Kunlunxin (which belongs to Baidu) and Cambricon, each having supplied local companies with 116,000 chips.
The decline of Nvidia in 2025, which supplied the Chinese market at 95% two years earlier, is not surprising. In April 2025, restrictions on American exports, which have existed since 2022, had tightened: the Trump administration had banned two of its American champions, Nvidia and AMD, from selling semiconductors intended for artificial intelligence to China.
Nvidia double victim of US restrictions and Beijing policies
Jensen Huang, at the head of the world leader in electronic chips, then regularly pleaded for American technology to still be used in China, a way to prevent it from being replaced by Chinese alternatives. In December 2025, his efforts paid off.
The American administration finally authorized Chinese technology companies to acquire Nvidia H200 chips – chips that Nvidia voluntarily made less powerful so that they fell below the performance thresholds set by Washington. For its part, Beijing also finally gave the green light, although advising against its companies to use American technologies.
But the debate is far from over in the United States. Last week, two US senators demanded that Nvidia suspend its sales of cutting-edge AI chips to China and intermediary countries in Southeast Asia… after the arrest of three people accused of being involved in semiconductor trafficking.
Also read: After AI chip trafficking to China, Nvidia is under pressure again
An American bill, which should soon return to the forefront, also wants to force American chip manufacturers like Nvidia and AMD to integrate geolocation technology into high-end semiconductors… The objective? Check that these do not arrive in China. Local companies regularly manage to circumvent American restrictions by going through subsidiaries, third-party companies or rental systems to source the latest generation American chips.
Also read: Semiconductor war: the Chinese giants’ schemes to circumvent US sanctions
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