In the first half of 2026,Nvidia's hold on China's data-center AI chip market declined to a 34% share. This shift comes as US export restrictions limit the availability of high-end hardware, allowing domestic competitors to capture significant territory.
Nvidia's 44% shipment drop and the 34% market share
The scale of Nvidia's reterat in the Chinese market is stark. According to an IDC report, Nvidia shipped 678,000 AI accelerators in China between January and June, representing a 44% decrease compared to the previous year. This slump has compressed Nvidia's share of the data-center AI chip market to 34% in the first half of 2026.
The decline is not a result of poor product demand, but rather a direct consequence of US export controls. These regulations have severely restricted the types of high-performance chips Nvidia can legally sell to mainland Chinese firms, creating a vacuum in one of the world's most critical AI hubs.. As a result, the 991,000 GPUs shipped to the region fell by 26%, as IDC data showed that eligible supplies remained limited.
Huawei's climb to a 28% share of the AI accelerator market
While Nvidia struggled with regulatory hurdles, Huawei aggressively filled the void. Huawei shipped 572,000 AI accelerators during the first half of the year, a massive jump from the more than 300,000 units it moved in the prior year. This surge has propelled Huawei to a 28% share of the overall AI accelerator market in China.
Huawei's growth demonstrates a rapid pivot toward domestic self-reliance. By providing a viable alternative for training and running AI models, Huawei is positioning itself as the primary beneficiary of the geopolitical friction between Washington and Beijing. The company's ability to nearly double its shipments suggests that Chinese enterprises are now confident enough in domestic silicon to migrate away from the industry-stanadrd Nvidia ecosystem.
The rise of nine Chinese chipmakers amid GPU shortages
The shift toward domestic hardware is not limited to a single company. According to the IDC report, nine of the 11 Chinese chipmakers tracked by the firm saw an increase in shipments over the last year. This indicates a broader trend of "de-Americanization" within China's tech stack, where a diverse ecosystem of local players is emerging to support the nation's AI ambitions.
This trend echoes previous cycles of trade volatility, where sanctions intended to stifle a rival's progress inadvertently accelerate their internal innovation. With total AI-accelerator shipments reaching 2.008 million units in the first half of the year , the market is expanding even as the dominant Western player is pushed out. The result is a fragmented but rapidly growing domestic industry that no longer views Nvidia as an irreplaceable necessity.
The missing data on the remaining 2.008 million shipments
Despite the clarity on Nvidia and Huawei, several critical questions remain. While IDC tracked 11 chipmakers, the report does not specify the identities or the specific market shares of the other nine firms that saw growth. It remains unclear whether these smaller players are offering niche solutions or if they are beginning to compete directly with Huawei's high-end accelerators.
Furthermore,the report focuses on shipment volumes rather than performance benchmarks. It is currently unknown if the domestic chips being shipped are truly equivalent in compute power to the restricted Nvidia H100 or B200 series, or if Chinese firms are simply making do with less efficient hardware to maintain their AI development timelines.
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