Nvidia now holds 34% of China's AI chip market, down from a position of near-total dominance, according to data from research firm IDC. Huawei is the direct beneficiary of that decline.

The figure marks a sharp reversal for the US semiconductor maker (chip designer listed on NASDAQ as NVDA). Two years ago, Nvidia controlled an estimated 90% or more of the AI accelerator market in China. Export controls imposed by Washington have since constrained what the company can legally sell there. IDC's numbers suggest those restrictions are now visible in market share, not just in revenue guidance.

Huawei, the Chinese telecommunications and semiconductor group, is the gainer named in the IDC data. The company has pushed its Ascend line of AI processors (chips designed to train and run large AI models) as a domestic alternative to Nvidia's hardware.

What does the 34% figure actually measure?

IDC tracks the market for AI chips sold into China. A 34% share means roughly two-thirds of that market is now served by other suppliers. Huawei leads the challengers.

The report does not, according to available details, break out the exact share captured by Huawei, nor does it specify the measurement period. Readers should treat the 34% as a snapshot, not a trend line. One quarter of data cannot confirm a sustained shift; Nvidia's share has fluctuated as export rules changed and as the company developed compliant chip variants for China.

What is not said in the report?

Three gaps stand out.

• The IDC summary does not state Huawei's precise share, only that it gained ground.
• It does not report unit volumes or revenue, so share may shift on low total sales.
• It does not distinguish between chips used for AI training (the compute-heavy process of building models) and inference (running trained models), where vendor rankings often differ.

Nvidia has not publicly commented on the IDC figure, based on the information available. The company continues to design export-compliant chips for China, though US regulators have restricted successive versions.

How should investors read this?

With caution. A falling China share hurts Nvidia less than it once would have; the company's revenue now skews heavily toward US cloud providers building large data centers. China represented a declining portion of Nvidia's data center revenue well before this report.

For Huawei, the gain confirms what procurement data in China has hinted at for a year: domestic buyers, including state-linked entities, are under pressure to source local accelerators. Whether Huawei's supply chain can sustain that demand at scale remains the open question, because advanced chipmaking capacity in China is itself constrained by the same export-control regime.

The comparison that matters: Nvidia losing China resembles Boeing losing a major export market — painful, strategically significant, but survivable while demand elsewhere stays strong. The strategic loss for Washington is symmetrical; every share point Nvidia cedes narrows the leverage that export controls were designed to create.

IDC has published no forward forecast in the available material. Any claim about where Nvidia's share settles next year would be speculation, and this report will not engage in it.

By Priya Raman