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Something big is shifting in one of the most important tech markets on the planet. New numbers show Nvidia is no longer the runaway leader in China’s data-center AI chips the way it used to be. Domestic players are catching up quickly, and the gap is getting uncomfortably narrow.
According to an IDC report that Reuters got a look at, Nvidia’s share of China’s data-center AI chip market dropped to 34% in the first half of 2026. The company shipped 678,000 AI accelerators (those specialized chips used to train and run AI models) between January and June, a 44% drop from the same period a year earlier.
Huawei is the clearest winner so far. It shipped 572,000 AI accelerators in the first half, up from just over 300,000 the year before. That put Huawei at 28% market share, only six points behind Nvidia. Nine out of the 11 Chinese chipmakers that IDC tracked saw year-on-year growth. Other local names also moved up: Alibaba’s T-Head took 7%, Cambricon 5%, Baidu’s Kunlunxin 4%, and Hygon 3%.
This isn’t just about one company’s numbers. It’s the combined effect of US restrictions and Beijing’s push for tech self-reliance. Chinese companies now need approval before they can import certain compliant Nvidia chips, and the government is actively encouraging them to use home-grown alternatives.
Nvidia CEO Jensen Huang has been pretty vocal about this, saying the export controls have basically handed a chunk of China’s roughly $50 billion AI chip market over to rivals like Huawei. As of the latest reports, Nvidia itself hadn’t commented on the IDC figures.
The bottom line: Nvidia is still the biggest single supplier by unit volume, but Chinese firms are expanding fast, especially in the specialized accelerators that sit outside the traditional GPU world. How much further this goes will depend on export rules and how quickly domestic production scales up.
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