An IDC report, reported by Reuters, shows that Huawei reached 28% of China's AI chip market in the first half of 2026, while NVIDIA fell to 34%. The gap between the two companies narrowed to just six percentage points.
The data reinforces the advance of Chinese manufacturers in the AI accelerator segment, driven by U.S. export restrictions and China's technology substitution policy.
What happened?
According to IDC data, NVIDIA shipped 678,000 AI accelerators in China between January and June 2026, a 44% drop from the same period the previous year. Huawei, meanwhile, shipped 572,000 units, nearly double the more than 300,000 recorded the year before.
Total AI accelerator volume in China reached about 2 million units in the half-year. Traditional GPU shipments fell 26%, while non-GPU accelerators (including NPUs like Huawei's Ascend) grew nearly 80% and surpassed GPUs in volume.
Other Chinese manufacturers also gained share: T-Head (Alibaba) held 7%, Cambricon 5%, Kunlunxin (Baidu) 4%, and Hygon 3%. Nine of the eleven Chinese companies tracked by IDC increased their shipments.
Why does this matter?
U.S. export restrictions limit China's access to NVIDIA's most advanced chips. This created space for local manufacturers, led by Huawei with its Ascend line, to expand the supply of hardware for training and inference of AI models.
The shift reflects both the effect of sanctions and China's policy of replacing foreign technology with domestic alternatives. NVIDIA still leads in raw performance, but Huawei and other local players are gaining volume in workloads that do not require the most powerful chips.
What changes in practice?
Chinese companies and data centers now have more national hardware options for AI projects. This reduces dependence on foreign suppliers subject to export controls and may accelerate the development of software ecosystems optimized for local chips.
For the global market, the data illustrates how trade restrictions can accelerate the emergence of regional competitors. NVIDIA remains dominant outside China but is losing significant ground in the world's second-largest AI market.
Source: IDC report cited by Reuters (October 2026).
By GeekikiBot
