Nvidia CEO Warns U.S. Chip Limits Could Affect China Market

Published Date : 22/05/2025 

Nvidia CEO Jensen Huang has criticized U.S. chip export controls, stating they have significantly reduced the company's market share in China and accelerated China's efforts to develop its own chips. 

Nvidia CEO Jensen Huang has expressed strong concerns over U.S. chip export controls, labeling them a 'failure' and warning that they are causing more harm to American businesses than to China. Speaking at Computex, a major artificial intelligence trade show in Taiwan, Huang detailed the damaging effects of these policies on Nvidia's China operations.

Huang revealed that the export controls have reduced Nvidia's market share in China from 95% to 50%, a significant drop that underscores the impact of these restrictions. He also noted that the policies have spurred Beijing to accelerate its efforts in developing its own advanced chips.

The comments come at a time when the truce between the U.S. and China over tariffs and semiconductors remains fragile. The Chinese Commerce Ministry has responded to the Trump administration's recent chip policy changes, describing the U.S. measures as 'overreaching' and 'bullying.' The ministry has called on the White House to 'correct its mistakes.'

The White House has scrapped the tiered 'AI Diffusion Rule' introduced by former President Joe Biden in January, promising to fully replace it in the future. Nvidia finds itself caught in the middle of a deepening tech cold war, maintaining relationships with both sides.

In a recent visit to Saudi Arabia, President Donald Trump referred to Huang as a 'friend' and highlighted Nvidia's substantial AI investment. Huang accompanied Trump on the Middle East trip, representing a significant aspect of the U.S.' global technology power. However, Huang has also maintained close ties to China, praising the country's tech capabilities.

Nvidia is expanding its presence in Shanghai with a new office space for its employees, though the company has clarified that it will not send any intellectual property or graphics processing unit designs there. During a visit to Washington in April, Huang warned lawmakers that China is rapidly catching up to the U.S. in AI.

'China is right behind us,' Huang stated. 'We are very close. Remember this is a long-term, infinite race.' He also highlighted the capabilities of Huawei, noting the company's significant progress in computing and network technology, essential for advancing AI.

Despite the rocky relationship between the U.S. and China, Huang assured senior Chinese officials in April that Nvidia would 'unswervingly serve the Chinese market.' Nvidia continues to navigate the complex landscape, reshaping its chips to comply with regulations while balancing commercial and political interests.

Huang's warning is clear: if the U.S. does not reconsider its approach, it risks losing the Chinese market and its competitive edge in the global AI race. 

Frequently Asked Questions (FAQS): 

Q: What are U.S. chip export controls?

A: U.S. chip export controls are restrictions placed by the U.S. government on the export of advanced semiconductor chips and related technologies to certain countries, particularly China, to limit their technological advancements and military capabilities.

Q: How have these controls affected Nvidia's market share in China?

A: According to Nvidia CEO Jensen Huang, the U.S. chip export controls have reduced Nvidia's market share in China from 95% to 50%, significantly impacting the company's presence and revenue in the Chinese market.

Q: What is Nvidia's stance on these export controls?

A: Nvidia CEO Jensen Huang has criticized the export controls, describing them as a 'failure' and warning that they are causing more harm to American businesses than to China, while also accelerating China's efforts to develop its own advanced chips.

Q: What is the current relationship between the U.S. and China regarding semiconductors?

A: The relationship between the U.S. and China regarding semiconductors is currently fragile, with ongoing tensions over tariffs, export controls, and the development of advanced technologies. Both countries are vying for dominance in the global AI and semiconductor industries.

Q: What steps is Nvidia taking to navigate these tensions?

A: Nvidia is expanding its presence in China while ensuring it complies with U.S. regulations. The company is also reshaping its chips to stay compliant and maintain its commercial and political relationships with both the U.S. and China. 

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