Nvidia’s once-dominant hold on China’s advanced AI accelerator market has collapsed entirely, with Chief Executive Officer Jensen Huang confirming that the company’s share has plunged from about 95 percent to zero.
Huang made the disclosure during a live interview at the Future of Global Markets 2025 event hosted by Citadel Securities in New York on October 6, describing the loss as an unintended consequence of U.S. export controls.
“At the moment, we are 100% out of China,” Huang said. “We went from 95% market share to 0%.”
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The remarks, which were later published in full by Citadel Securities on YouTube, mark the first time Nvidia has publicly quantified the impact of the restrictions. Though Huang did not reference specific products, his comments were clearly directed at Nvidia’s data center GPU business — the backbone of global AI infrastructure and one of the fastest-growing segments of the company’s portfolio.
A Collapse Driven by U.S. Policy
Since Washington began tightening export controls on high-end semiconductors in October 2022, Nvidia has faced repeated disruptions to its product line in China. The company’s China-optimized A800 and H800 chips, designed to comply with earlier restrictions, were later rendered ineligible under expanded rules introduced in 2023. Nvidia’s most recent offering, the H20 GPU, also encountered licensing complications that prevented large-scale sales.
On July 31, China’s Cyberspace Administration summoned Nvidia executives for a closed-door meeting, demanding an explanation over concerns that the H20 chips could contain hidden hardware mechanisms enabling remote shutdown or unauthorized access—so-called “backdoors” that bypass normal security protocols. Such vulnerabilities, if proven, could theoretically allow foreign actors to disrupt AI systems or siphon sensitive data without detection.
In September, the Financial Times reported that the CAC directed companies, including ByteDance, parent of TikTok, and e-commerce giant Alibaba, to terminate their testing and orders of Nvidia chips, including RTX Pro 6000D. The order also covered existing purchases, effectively forcing cancellations.
The cumulative effect has been a near-total halt to shipments of advanced AI accelerators to the Chinese market — a market that, according to Nvidia’s own disclosures, accounted for 20 to 25 percent of its data center revenue before the sanctions. That segment alone generated more than $41 billion in the company’s latest financial year, representing a 56 percent year-on-year increase.
“I can’t imagine any policymaker thinking that’s a good idea — that whatever policy we implemented caused America to lose one of the largest markets in the world to 0%,” Huang said, criticizing the policy outcome rather than the intent.
Strategic Blow to Both Sides
The export controls were designed to prevent China from accessing chips that could accelerate the development of advanced military AI systems. However, the policy’s collateral effects are increasingly visible: Nvidia, the world’s most valuable semiconductor company, has effectively been locked out of one of its largest markets, while Chinese companies have been forced to accelerate their domestic chip development programs.
“In all of our forecasts… we’re assuming 0% for China,” Huang said. “If anything happens in China… it will be a bonus.”
That stark admission points to how deeply the restrictions have reshaped Nvidia’s business strategy. The company has now shifted its focus entirely toward North America, Europe, and the Middle East, where demand for AI infrastructure remains exceptionally strong.
Meanwhile, Chinese hyperscalers and AI research labs — including Baidu, Alibaba, Tencent, and ByteDance — have been investing heavily in indigenous silicon efforts. Domestic chipmakers like Huawei’s HiSilicon and startups backed by Beijing’s state investment arms have gained new momentum, attempting to fill the performance gap left by Nvidia’s absence.
Fragmentation in the AI Supply Chain
The rupture has exposed how fragile the global AI hardware ecosystem has become. Huang himself has repeatedly warned that sweeping export restrictions could “spur the development of competitive substitutes” and create parallel technological spheres — one dominated by the U.S. and its allies, and another centered around China’s domestic innovation drive.
That fragmentation is now unfolding rapidly. China’s AI industry has turned to alternative architectures such as Huawei’s Ascend processors and cloud platforms built on local chips, while simultaneously scaling software optimization to squeeze more performance from limited hardware.
Although U.S. policymakers argue that the curbs are essential for national security, industry analysts caution that the restrictions risk eroding American companies’ long-term leverage in global technology markets. Nvidia’s forced retreat provides an early case study of that effect.
A Market Written Off — For Now
While Huang said he still hopes that Nvidia can eventually resume business in China, the company’s near-term outlook leaves no room for optimism.
The development caps a two-year struggle for Nvidia to navigate the geopolitical crossfire between Washington and Beijing. What began as a temporary workaround strategy through products like the A800 has now become a complete disengagement.
For now, the company’s record profits from surging global demand for AI chips have softened the blow. But the broader implications: the world’s top AI chipmaker being locked out of the world’s second-largest economy, while China, once its biggest growth market, races to build a rival ecosystem of its own, remains profound.
